Frankowski Firm

On November 19, 2020, the Securities & Exchange Commission announced an award of $900,000 to a whistleblower whose timely and important information resulted in a significant expansion of an ongoing investigation. The Frankowski Firm is currently assisting whistleblowers to report securities fraud and misconduct. If you believe your company might be participating in securities fraud, [...]

On December 1, 2020, the Securities & Exchange Commission announced an award of $6 million to joint whistleblowers whose information and assistance led to the successful enforcement of SEC and related actions.  The whistleblowers’ substantial assistance, provided to the SEC and another government agency, included submitting documents, participating in interviews, and identifying key individuals involved [...]

Dennis Phillip Ayre, of Van Nuys, California, continues to draw customer complaints in Financial Industry Regulatory Authority (“FINRA”) arbitration. Mr. Ayre’s FINRA BrokerCheck Report reveals that he is currently the subject of seven customer disputes totaling nearly $10 million in claimed losses. The complaints allege that Mr. Ayre made unsuitable investments involving excessive risk and [...]

Moloney Securities Co. Inc. was recently censured and fined $100,000 and required to pay $15,574.13, in restitution to a customer. The FINRA findings stated that Moloney, from January 2013 through April 2015, violated FINRA Rules 3110 and 2010 and NASD Rule 3010 by failing to create and enforce a supervisory system to comply with FINRA’s [...]

The Financial Industry Regulatory Authority (“FINRA”) has banned Louis Cook, who was a Staten Island, New York-based representative for National Planning Corporation and Securities Service Network. FINRA found that Cook induced elderly customers and parents of disabled children to sign third-party authorization forms through intentional misrepresentations, violating FINRA Rules 2010 and 2150(a). According to FINRA’s [...]

The Financial Industry Regulatory Authority (“FINRA”) has barred Dee Dee Brooks, of Sarasota, Florida, based on findings that, while acting as an agent of Signator Investors, Inc., Brooks engaged in private securities transactions without any notice to or approval from her firm. According to FINRA’s findings, From July 2016 to December 2017, Brooks solicited investors [...]

The Financial Industry Regulatory Authority (“FINRA”) has censured and fined Apex Clearing Corporation for violations of Securities and Exchange Commission Rules. According to FINRA’s findings, Apex failed to establish procedures reasonably designed to assure that introduced customers received the initial margin interest rate disclosures and failed to establish, maintain, and enforce a supervisory system, including [...]

The Financial Industry Regulatory Authority (“FINRA”) has barred Joseph Stone Capital, LLC representative Erik Pica following findings that Pica took a 76-year-old customer’s $200,000, and used the money to purchase a house for himself. According to FINRA’s findings, in 2019, Pica suggested to the customer that he should invest in pre-initial public offering (pre-IPO) shares [...]

Recent Financial Industry Regulatory Authority ("FINRA") findings reveal that Two Sigma Securities, LLC failed to comply with the Locate Requirement of Rule 203(b)(1) of Regulation SHO pursuant to the Securities Exchange Act of 1934. While not in any formal arrangement to borrow securities, Two Sigma Securities, LLC effected short sale transactions from March 21, 2014 [...]

BNP Paribas Securities Corporation was recently fined for failing to create or maintain a risk management system of controls or procedures to handle the financial risks of its market access business activity. Specifically, FINRA found that the firm made multiple supervisory failures, provided market access through its Global Execution Services (GES) Desk, and maintained unreasonable [...]

Moors & Cabot, Inc. has been fined by the Financial Industry Regulatory Authority ("FINRA") for failing to provide written disclosure to customers of around $7.5 million of compensation from earnings of about 11,500 trades in preferred securities. While acting in a principal capacity, Moors & Cabot, Inc. purchased preferred shares from one of its customers [...]

According to the Consumer Financial Protection Bureau’s (CFPB) Consumer Complaint Database, the popular investing and trading platform Robinhood Markets, Inc. (“Robinhood”) received fifty-nine (59) consumer complaints so far in 2020, as of the date of writing. Customer complaints against Robinhood in the CFPB database include locked accounts, withdrawal delays, customer service responsiveness, among other issues. [...]

Concorde Investment Services, LLC  and its Chief Compliance Officer, Kimberlee Elizabeth Levy, were recently censured and fined by the Financial Industry Regulatory Authority (FINRA) for failing to reasonably supervise a former representative who allowed her husband to conduct business transactions and trades with Concorde’s customers while he was serving a FINRA-imposed one-year suspension. While aware [...]

Lek Securities Corporation was recently found by the Financial Industry Regulatory Authority (“FINRA”) to have failed in implementing Anti-Money Laundering (AML) policies and internal controls to detect suspicious transactions and comply with the Bank Secrecy Act and regulations from the Department of the Treasury. Samuel Lek was the firm’s CEO, chief compliance officer (CCO), and [...]

The value of New York City REIT, Inc. has tanked since its public listing in August 2020. According to Investment News, some investors have suffered losses as high as 80% from its initial sales price. If you invested in New York City REIT, Inc., or your broker or advisor recommended New York City REIT, Inc., [...]

On October 19, 2020, the Financial Industry Regulatory Authority fined and suspended former broker of SagePoint Financial, Troy Robert Baily, for engaging in four undisclosed and unapproved private securities transactions totaling $210,000. From November 2016 through March 2018, Baily was registered with FINRA as an investment company and variable contracts products representative, and associated with [...]

On October 15, 2020, Kevin Barletta, formerly registered as a general securities representative through an association with LPL Financial LLC,  submitted a Letter of Acceptance, Waiver and Consent for the purpose of proposing a settlement of alleged rule violations connected to prohibited cross trades of alternative investment products. According to his FINRA BrokerCheck report, Kevin [...]

Morgan Stanley Smith Barney LLC was recently sanctioned for failing to reasonably supervise a representative for recommending short-term trades of corporate bonds and preferred securities for ten customer accounts. On hundreds of occasions, the representative at issue recommended the buying and prompt selling of preferred securities or corporate bonds to customers of Morgan Stanley, which [...]

From January 2013 through December 2017, SagePoint Financial Inc. failed to create or maintain a supervisory system or enforce WSPs to supervise the suitability recommendations to customers regarding early rollovers of Unit Investment Trusts (UITs), according to findings by the Financial Industry Regulatory Authority ("FINRA"). Generally, a Unit Investment Trust (UIT) is a non-actively managed [...]

Newport Coast Securities, Inc. was recently expelled from FINRA membership fined $403,000 and ordered to pay $853,617.04 plus interest to customers in restitution for excessively trading in and churning customer accounts through five representatives and two registered principals. The FINRA findings stated that: Newport’s customers impacted by their misconduct were predominantly older, nearing retirement, had [...]