Articles Tagged with unsuitable investments

shutterstock_164634200-300x200Securities attorneys at Gana Weinstein LLP are currently investigating previously registered broker Guistino Destefano (Destefano). According to BrokerCheck Records, Destefano has been subject to two terminations from employment and one regulatory action in which the Financial Industry Regulatory Authority (FINRA) sanctioned Destefano for various violations of the securities laws. In addition,  Destefano has been subject to 6 customer disputes concerning unauthorized trades and unsuitable investments, one of which is still pending.

In May 2014, Destefano resigned from Merrill Lynch, Pierce, Fenner & Smith Incorporated (Merrill Lynch) due to customer allegations of unauthorized trading and recommending securities to customers that weren’t approved by the firm. Subsequently, in March 2016, FINRA found that between July 2013 and May 2014, Destefano had executed unauthorized trades in 4 non-discretionary customer accounts. In addition, Destefano also had marked over 100 order tickets incorrectly, labeling them “unsolicited” when they were in fact solicited trades. For executing unauthorized trades, Destefano was found to be in violation of unauthorized NASD Conduct Rule 2510(b) and FINRA Rule 2010. Destefano consented to the sanctions and to the entry of findings and FINRA suspended Destefano for 3 months and imposed a fine of $10,000.

In addition, Destefano has been subject to multiple customer complaints. In September 2017, a customer alleged that Destefano exercised discretion in non-discretionary customer accounts, over-concentrated investments, and placed customers in unsuitable investments. The customer has requested $830,000 in damages. This dispute is currently still pending.

In March 2017, a customer alleged that from September 2010 to August 2014, Destefano placed the customer in unsuitable investments.   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_24531604-200x300The investment lawyers of Gana Weinstein LLP are investigating claims against Robert Clarke (Clarke). According to BrokerCheck records, Clarke has five disclosures, four of them being customer complaints.

In August 2017, a customer alleged Clarke misrepresented the nature of an investment and the purchase of the investment in the customer’s accounts. The customer is seeking $500,000 in this pending dispute.

In March 2016, a customer alleged Clarke misrepresented and made an unsuitable recommendation for the customer to invest in collateralized mortgage obligations. This dispute settled for $120,000.
In April 2014, a customer alleged unsuitable investment, transfer of accounts handled negligently, lack of fiduciary duty, and lack of supervision. This dispute settled for $77,205.

False representations include either written or oral statements containing misrepresentations or omissions of information that are material to an investor and induce the purchase, sale, or holding of a security. Under the Securities Exchange Act of 1934 (15 U.S.C. § 78a et seq.) and Rule 10b-5 a misrepresentation or omission of a fact is material if a reasonable investor might have considered the fact important in the making of the investment decision. Also the Financial Industry Regulatory Authority (FINRA) Rule 2020 also prohibits members from effecting “any transaction in, or induce the purchase or sale of, any security by means of any manipulative, deceptive or other fraudulent device or contrivance.”

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shutterstock_189302963-300x194The investment lawyers of Gana Weinstein LLP are investigating the regulatory action brought by the Financial Industry Regulatory Authority (FINRA) against broker James Cox (Cox).

According to Cox’s Brokercheck records, he has been sanctioned by FINRA because he allegedly recommended unsuitable annuity transactions to a customer and received commissions of $25,460 in connection with the exchange. Without admitting or denying the findings, Cox consented to the sanctions and to the entry of findings. Cox was suspended from FINRA for four months and fined a total of $35,460.

In April 2017, Cox was terminated from Stifel, Nicolaus & Company, Incorporated because of a “lack of confidence after settlement of customer complaint and nondisclosure of outside business activity”

Moreover, Cox has been subject to four customer disputes.

In June 2012, a customer alleged that when the customer retired, Cox made unsuitable recommendations, made material misrepresentations, and breached his fiduciary duty. This dispute settled for $25,000.

In June 2014, a customer alleged that Cox failed to monitor the customer’s account and invested his assets in unsuitable investments. This dispute is pending.

Subsequently, In November 2014, Cox allegedly provided misleading advice to a customer who applied for two annuities to replace older annuities. This dispute settled for $480,000.

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shutterstock_61142644-300x225According to BrokerCheck records kept by the Financial Industry Regulatory Authority (FINRA), broker Jeanette Adcock (Adcock) has been sanctioned for allegedly not complying with Illinois Securities Law.

Additionally, Adcock has been subject to three customer disputes in 2017. Moreover, In April 2017, Adcock was “permitted” to resign from Wayne Hummer Investments because she “failed to forward a written customer complaint to her supervisor or compliance department as required.”

In November 2017, a customer alleged that Adcock made misleading statements regarding a risky investment. The customer is requesting $25,000 in damages in this pending dispute.

In January 2017, a customer alleged Adcock misrepresented and recommended unsuitable products. This dispute settled for over $20,000.

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shutterstock_143685652-300x300The securities attorneys at Gana Weinstein LLP are investigating potential claims against former Capital Securities Management Inc. broker Teryl Trenchard (Trenchard). According to Trenchard’s BrokerCheck records, he was identified in a Financial Industry Regulatory Authority (FINRA) investigation on March 10, 2017. FINRA is examining alleged fraudulent activities of Trenchard.

Trenchard was terminated by Capital Securities Management on March 10, 2017 based upon the FINRA investigation for fraud.

In a pending customer complaint, it has been alleged that Trenchard engaged in misappropriation, forgery, fraud and unauthorized trading in unsuitable transactions between 2005 and 2017. The alleged damages are $1,800,000.

In another pending complaint, a customer is alleging breach of fiduciary duty, breach of contract, conversion, and unsuitable investment recommendations. The customer is alleging damages of $700,000.

In 2000, a customer alleged that Trenchard made several unauthorized trades in her account. This complaint settled for $28,049.49.

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shutterstock_171397469-300x228The investment lawyers of Gana Weinstein LLP are investigating the regulatory action brought by the Financial Industry Regulatory Authority (FINRA) against former Morgan Stanley broker Peter Doyle (Doyle).

According to BrokerCheck records, Doyle was terminated from Morgan Stanley in June 2016 for failing to adhere to industry rules and/or firm policies including with regard to the use of trading discretion. Doyle’s failure to appear for FINRA requested on-the-record testimony in connection with its investigation into the conduct that led to his termination led to his bar from the industry. Without admitting or denying the findings, Doyle consented to the sanction and to the entry of findings that he refused to appear.

Before Doyle’s termination, Morgan Stanley was ordered by a FINRA arbitration panel to pay over $8 million in damages in a customer dispute concerning allegations that Doyle made unauthorized trades, failed to disclose fees, and engaged in the financial abuse of an elderly customer.

shutterstock_64859686-300x300The investment lawyers at Gana Weinstein LLP are investigating customer complaints against Pennsylvania Broker/Investment Advisor Nadav Baum (Baum). According to BrokerCheck records, Baum has been subject to fourteen customer complaints and two regulatory sanctions. The customer complaints allege that Baum engaged in securities law violations, including making unsuitable investments in client’s accounts.

In March 2017, the New Jersey Bureau of Securities sanctioned Baum after he allegedly failed to comply with the terms of a supervisory agreement. He was ordered to cease and desist and to pay a fine of $6,000.

In August 2009, the Financial Industry Regulatory Authority (FINRA) sanctioned Baum following allegations he executed discretionary trades without written authorization in the account of a deceased customer and executed discretionary trades in other accounts without authorization. He was issued a 30-day suspension and a fine of $15,000.

shutterstock_176198786-300x200The investment lawyers of Gana Weinstein LLP are investigating the regulatory action brought by the Financial Industry Regulatory Authority (FINRA) against John Leonard (Leonard), working out of Toledo, Ohio. Leonard allegedly failed to request termination of a previous suspension within three months resulting in an automatic bar from association with any FINRA member in all capacities.

According to BrokerCheck records, Leonard had been suspended from associating with any FINRA member in any capacity for allegedly failing to respond to a FINRA request for information. Leonard was barred by FINRA after he failed to request termination of this suspension.

Leonard has been named in five customer complaints and one that is still pending.

The most recent complaint was in June 2016 and alleged unsuitable recommendations. This dispute settled for $25,000. Another complaint in June 2016 alleged unsuitable investments. This dispute settled for $24,000. In October 2016, a different client alleged unsuitable investments. This dispute settled for $60,000. In September 2016, another customer alleged unsuitable investment recommendation were made in 2013 and 2014. This dispute settled for $50,000.

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shutterstock_173849111-227x300The Financial Industry Regulatory Authority (FINRA) has ordered Wells Fargo Clearing Services, LLC and Wells Fargo Advisors Financial Network, LLC to pay more than $3.4 million in restitution to customers for alleged unsuitable recommendations of volatility-linked exchange-traded products (ETPs) and supervisory failures, according to InvestmentNews.

FINRA found that between July 1, 2010, and May 1. 2012, “certain Wells Fargo reps recommended volatility-linked ETFs and ETNs without fully understanding their risks and features.”

According to FINRA, “certain Wells Fargo representatives mistakenly believed that the products could be used as a long-term hedge on their customers’ equity positions in the event of a market downturn. In fact, volatility-linked ETPs are generally short-term trading products that degrade significantly over time and should not be used as part of a long-term buy-and-hold investment strategy.”