Securities Lawyers Blog
Former financial advisor Keith Dagostino (Dagostino), formerly employed by brokerage firms Aegis Capital Corp (Aegis) and EF Hutton LLC (EF Hutton) has been subject to at least 18 customer complaints during the course of his career. According to a BrokerCheck reports most of the recent customer complaints concern either equity securities and initial public offering securities (IPOs). The attorneys at Gana Weinstein LLP have represented hundreds of investors who suffered losses caused by these types of investments.
In August 2024 a customer complained that Dagostino violated the securities laws by alleging that Dagostino recommended unsuitable investment strategy and breach of fiduciary duty. The claim alleges $1 million in damages and is currently pending.
In August 2024 a customer complained that Dagostino violated the securities laws by alleging that Dagostino recommended unsuitable investment strategy and breach of fiduciary duty. The claim alleges $589,000 in damages and is currently pending.
In August 2024 a customer complained that Dagostino violated the securities laws by alleging that Dagostino mishandled and IPO transaction and the Claimant seeks a return of the funds. According to the broker comment this matter involves the initial public offering of Veg House which EF Hutton negotiated for Claimant’s securities purchase agreement with PlantX for the Veg House shares. The claim alleges $1 million in damages and is currently pending.
Brokers are required to adhere to the SEC’s Regulation Best Interest (Reg BI) standard of care under the Securities Exchange Act of 1934 which establishes a “best interest” standard for broker-dealers and associated persons. This standard applies when brokers make recommendations to retail customer for any securities transaction or investment strategy involving securities, including recommendations of types of accounts. Reg BI is drawn from fiduciary principles that include an obligation to act in the retail investor’s best interest and the broker is prohibited from placing their own interests ahead of the investor’s interest.
There are several different aspects of the rule that brokers must comply with. One of which is the care obligations which requires brokers to form a reasonable belief that their investment advice and recommendations are in the retail investor’s best interest. The care obligations includes three components. First, the advisor must have an understanding of the potential risks, rewards, and costs associated with a product, investment strategy, account type, or series of transactions. Next, the advisor must have a reasonable understanding of the specific retail investor’s investment profile. The customer’s profile information generally includes an investor’s financial situation and needs; investments; assets and debts; marital status; tax status; age; investment time horizon; liquidity needs; risk tolerance; investment experience; investment objectives and financial goals; and any other information the retail investor may disclose in connection with the recommendation or advice. Finally, the advisor must use their knowledge of the first two elements to consider reasonably available investment option alternatives and come to the conclusion that there is a reasonable basis to believe that the recommendation or advice being provided is in the retail investor’s best interest.
An advisor must understand the type of account, securities, and their client in order to meet their care obligations. The type of securities account has the potential to greatly affect retail customers’ costs and investment returns. Different types of securities accounts can offer different features, products, or services, and not all types of accounts or services would be in every investor’s best interest.
Dagostino entered the securities industry in 1997. From October 2014 until November 2023, Dagostino was associated with Aegis. From October 2023 until October 2024 Dagostino was registered with EF Hutton out of the firm’s Woodbury, New York office location.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.