Articles Tagged with churning attorney

shutterstock_120556300-300x300According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA), in January 2018, advisor Larry Boggs (Boggs) was barred indefinitely from the financial industry by FINRA concerning allegations that he engaged in unsuitable investments, excessive trading and unauthorized transactions. According to FINRA, Boggs exercised discretion in customer accounts without written approval from customers or the firm. Boggs would also allegedly falsely state the investment objectives and risk tolerance of customers in the firm’s books so that customers would conform to his high-frequency trading strategy.

FINRA found that in June 2010, Boggs updated the risk tolerance in 4 investment portfolios from Moderate to Moderate/Aggressive, and changed 2 investment portfolio objectives to Aggressive.  FINRA determined that the high-frequency trading strategy was unsuitable to his customer’s needs and did not match the customer’s investment portfolio objectives. By changing Ameriprise’s books and records, Boggs violated FINRA Rules 4511 and 2010.

In addition, in May 2015, Boggs’ employer, Ameriprise Financial Services, Inc. (Ameriprise Financial) discharged Boggs alleging that Boggs violated the company’s discretionary trading and suitability policies.

In January 2016, Boggs filed for bankruptcy and was also discharged. Bankruptcies are a potential sign that the advisor has difficulty managing their own finances.  FINRA provides this information to the public because it is material for consumers to know whether or not their advisor’s financial situation influences the advisor’s recommendations. Continue Reading

shutterstock_160304408-300x199The investment fraud attorneys at Gana Weinstein LLP are currently investigating previously registered broker Daniel Fischer (Fischer). According to BrokerCheck, in January 2018, the Securities Exchange Commission (SEC) barred Fischer from the financial industry claiming that from December 2012 to May 2015, Fischer recommended an unsuitable investment strategy in penny stocks to 5 customers and falsely represented and omitted material facts about the strategy. In addition, the SEC alleged that Fischer was engaging in churning of accounts and in unauthorized trading. The SEC found that as a result of recommending unsuitable investments, Fischer had violated federal laws including Section 17(a) of the Securities Act of 1933, Section 10(b) of the Exchange Act and Rule 10b-5.

In addition, Fischer has also been subject to one regulatory action and one civil action in which the SEC and the Federal Industry Regulative Authority (FINRA) sanctioned Fischer for various violations of the securities laws.

In July 2016, FINRA suspended Fischer on the grounds that he was exercising discretion in customer accounts without prior customer approval. As a result of violating NASD Conduct Rule 2510(b) and FINRA Rule 2010, Fischer incurred a fine of $5,000 and a suspension of 20 days. Continue Reading

shutterstock_95416924-300x225The securities attorneys at Gana Weinstein LLP are investigating claims against Western International Securities, Inc. (Western International) broker Jorey Bernstein (Bernstein). According to BrokerCheck records, Bernstein has been subject to one pending customer complaint regarding excessive trading.

In August 2018, a customer alleged that from 2009 to 2014, Bernstein excessively traded their account. The customer requested damaged of $3,000,000. This dispute is currently still pending.

In addition, Bernstein has been subject to resignation from Morgan Stanley in 2015 due to customer allegations regarding Bernstein’s illegal interactions and outside business activities with a third-party. A broker’s outside business activities with a third-party can create a conflict of interest with the firm. Therefore, firms are required to monitor such activities through supervision that is in compliance with securities laws and regulations. Continue Reading

shutterstock_177082523-243x300According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker Anthony Sica (Sica) has been subject to three regulatory actions and nine customer complaints.  Sica is currently registered with Joseph Gunnar & Co. LLC (Joseph Gunnar).  The most recent regulatory action filed against Sica was in January 2018 by the Maryland Securities Commissioner who alleged that when it inquired about information provided to the state Scia agreed to withdraw his registration request.  Many of the customer complaints against Sica concerning high frequency trading activity also referred to as churning.

In Novemebr 2017, FINRA found that Sica unsuitable recommendations to an elderly customer living on a fixed income. FINRA alleged that Sica repeatedly recommended that the customer purchase high-risk securities that were inconsistent with her investment profile and resulted in an over concentration of the customer’s account in speculative securities.  FINRA also found that Sica engaged in short-term in-and-out trading of the speculative investments in the customer’s accounts causing substantial losses. FINRA alleged that Sica also engaged in unauthorized trading by placing trades in the IRA accounts of a customer who Sica knew was deceased.  FINRA suspended Sica for three months.

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shutterstock_77335852-300x225According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker Joseph Cotter (Cotter) has been subject to two customer complaints, two employment terminations for cause, and one regulatory action.  Cotter was formerly registered with Next Financial Group, Inc. (Next Financial).  In March 2016 Next Financial terminated Cotter claiming that the firm conducted an internal review of the trading activity in a customer’s accounts and found the level of trading activity to be excessive (excessive trading) in light of the customer’s profile and the character of the account.

Thereafter, FINRA investigated Cotter and found that Cotter engaged in excessive, unsuitable trading in the accounts of one customer. FINRA found that Cotter exercised de facto control over an IRA account and a second account of a customer.  FINRA determined that Cotter used this control to excessively trade the accounts in a manner that was inconsistent with the customer’s investment objectives, financial situation, and needs.  The trading generated commissions of $100,549 while the client lost $391,893.

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