Securities Attorney

Advisor Frank Venturelli Suspended By Securities Regulator

August 31, 2022 | by Staff Attorney

The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that Frank Venturelli has been subject to at least one customer complaint and two regulatory sanctions during his career. According to records kept by the Financial Industry Regulatory Authority (FINRA), Venturelli’s customer complaint alleges that Venturelli engaged in unauthorized trading and recommended unsuitable investments. While the two regulatory actions brought against him state that he consented to sanctions of engaging in unsuitable trading in customers’ accounts and committed fraud.

In December 2020, the New Jersey Bureau of Securities initiated disciplinary action against Venturelli. They alleged that Venturelli engaged in an act, practice, or course of business which would operate as fraud or deceit upon another person. BrokerCheck records state that Venturelli engaged in a pattern of excessive, unsuitable, and unauthorized trading activity in the accounts of certain customers. Civil and administrative penalties in the amount of $120,000 were issued against Venturelli’s employer, First Standard Financial Company LLC.

In June 2019, FINRA initiated disciplinary action against Venturelli. They allege that Venturelli engaged in quantitatively unsuitable trading in customers’ accounts. The findings stated that Venturelli recommended the trading in customers’ accounts, and they followed his recommendations. These recommendations were excessive, unsuitable given the customers’ investment profiles, and were such that it was virtually possible for any customers to earn a profit. Venturelli’s trading of the accounts resulted in high turnover rates and significant losses. Venturelli’s customers suffered collective losses of $373,226 and paid $169,803 in commissions and fees. Venturelli neither admits nor denies these findings. As a result, FINRA suspended Venturelli in all capacities for eleven months and issued partial restitution, due to his limited ability to pay, in the amount of $30,000.

Michael Fahsholtz Subject to 12 Customer Complaints Related to Investment Advice

August 31, 2022 | by Staff Attorney

The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that broker Michael Anthony Fahsholtz (Fahsholtz), most recently employed by Stifel, Nicolaus & Company, Inc. (Stifel) has been subject to at least twelve customer complaints during the course of his career. Fahsholtz is no longer registered as a broker. According to records kept by The Financial Industry Regulatory Authority (FINRA), Fahsholtz’s customer complaints alleges that Fahsholtz recommended unsuitable investments in various investments including allegations involving debt-corporate securities, unit investment trusts, and variable annuities, among other allegations of misconduct relating to the handling of their accounts.

In September 2021, a customer complained that Fahsholtz violated the securities laws by alleging that Fahsholtz engaged in unsuitable investment advice, and misrepresentations related to the risks of the recommended investments. The claim alleges $255,791 in damages and is currently pending.

In February 2021, a customer complained that Fahsholtz violated the securities laws by alleging that Fahsholtz engaged in unsuitable investment advice, negligence, and breach of fiduciary duty. Additionally, the customer alleges that Fahsholtz violated the Securities Act of Washington and FINRA Rule 3110. The damage amount requested was $106,000. The claim settled in the amount of $25,000.

In December 2020, a customer complained that Fahsholtz violated the securities laws by alleging that Fahsholtz purchase inappropriate securities for the customer, including stocks, bonds, and UITs. The damage amount requested was $40,000. The claim settled in the amount of $7,500.

Aegis Capital Advisor Johnny Guan Has Investor Complaints

October 25, 2021 | by Staff Attorney

The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that financial advisor Johnny Guan (Guan), currently employed by Aegis Capital Corp. (Aegis Capital) has been subject to at least two customer complaints during the course of his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), Mr. Guan’s customer complaints alleges that Mr. Guan recommended unsuitable investments in various investments including allegations involving real estate securities, options, and penny stocks, among other allegations of misconduct relating to the handling of their accounts

In December 2019, a customer complained that Mr. Guan violated the securities laws by alleging that Mr. Guan engaged in negligent investment advice, breach of fiduciary duty, and unauthorized transactions. The claim settled in the amount of $5,400.

In April 2016, a customer complained that Mr. Guan violated the securities laws by alleging that Mr. Guan engaged in unsuitable investment advice, negligence, and material misrepresentations. The claim settled in the amount of $7,200.

Raymond James Advisor Eric Bachinsky Has Several Disclosed Customer Complaints

September 15, 2021 | by Staff Attorney

The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that broker Eric Bachinsky (Bachinsky), currently employed by Raymond James & Associates, Inc. (Raymond James) has been subject to at least five customer complaints during the course of his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), Bachinsky’s customer complaints alleges that Bachinsky recommended unsuitable investments in various investments.

In March 2020, the attorney for a customer’s estate complained that Bachinsky violated the securities laws by alleging that Bachinsky engaged in unsuitable investments. The damage amount requested was $228,465.26. The damages were denied.

In November 2011, a customer complained that Bachinsky violated the securities laws by alleging that Bachinsky engaged in negligence, misrepresentation, breach of contract, and breach of fiduciary duty. The damage amount requested was $80,000. The claim settled in the amount of $24,000.

Advisor John Howard Has Unsuitable Investment Complaints

September 12, 2021 | by Staff Attorney

The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that advisor John Howard (Howard), currently employed by Raymond James & Associates, Inc. (Raymond James) has been subject to at least three customer complaints during the course of his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), Howard’s customer complaints alleges that Howard recommended unsuitable investments in various investments including allegations involving unauthorized trading among other allegations of misconduct relating to the handling of their accounts.

In September 2019, a customer complained that Howard violated the securities laws by alleging that Howard engaged in breach of fiduciary duty, negligence, breach of contract, and violated several other securities laws. The claim settled in the amount of $97,500.

In March 2008, a customer complained that Howard violated the securities laws by alleging that Howard engaged in unauthorized purchase of commercial paper. The claim settled in the amount of $1,134,601.00.

In February 2005, a customer complained that Howard violated the securities laws by alleging that Howard conducted unauthorized trades. The claim alleges settled in the amount of $7,859.83.

Advisor James G. Babineaux Accused of Making Unsuitable Investment Recommendations and Unauthorized Trading

April 10, 2021 | by Staff Attorney

Advisor James Babineaux (Babineaux), currently employed by Merrill Lynch, Pierce, Fenner & Smith, Inc. (Merrill Lynch) has been subject to at least two customer complaints during the course of his career. According to a BrokerCheck report the customer complaints concern unsuitable investment recommendations and unauthorized trading. In August 2018, a customer alleged Babineux engaged in unauthorized trading from July 26, 2018 through July 27, 2018. Additionally, that same year, another customer alleged that Babineux engaged in unsuitable investment recommendations and unauthorized trading from January 18, 2018 through July 27, 2018. Both matters settled for $1,322.21 and $2,853.93 respectively.

Unauthorized trading occurs when a broker sells securities without the prior consent from the investor. All brokers, who do not have discretionary authority to trade an account, are under an obligation to first discuss trades with the investor before executing them under NYSE Rule 408(a) and FINRA Rules 2510(b). Under the NASD Conduct Rule 2510(b), a broker is prohibited from trading in a non-discretionary customer account without prior written authorization from the customer. Unauthorized trading is a type of investment fraud because the Securities Exchange Commission (SEC) has found that disclosures of trades being made are essential and material to an investor. Unauthorized trading is often a gateway violation to other securities violations including churning, unsuitable investments, and excessive use of margin.

Broker Chadwick David Carrick Accused of Churning and Making Unsuitable Investments

April 4, 2021 | by Staff Attorney

Broker, Chadwick Carrick (Carrick), currently employed at The Jefferey Matthews Financial Group, LLC, has been subject to at least two customer complaints and one employment termination for cause over the course of his career. The two most recent occurring in 2018. According to a BrokerCheck report, the customer complaints include churning, allegations of unsuitable investments, unauthorized trading, and altering a journal form and a letter of authorization.

As of January 2018, there is a matter pending for allegations made by a client against Carrick for, among other things, churning and breach of fiduciary duty. Additionally, in September 2018, another client alleged that Carrick made unsuitable investments and engaged in unauthorized trading. This matter settled for $35,000. Moreover, in 2009, Carrick was discharged from Morgan Stanley after working there for five years for altering a journal form and a letter of authorization previously signed by the client.

When brokers engage in excessive trading, sometimes referred to as churning, the broker will typically trade in and out of securities, sometimes even the same stock, many times over a short period of time. Often times the account will completely “turnover” every month with different securities. This type of investment trading activity in the client’s account serves no reasonable purpose for the investor and is engaged in only to profit the broker through the generation of commissions created by the trades. Churning is considered a species of securities fraud. The elements of the claim are excessive transactions of securities, broker control over the account, and intent to defraud the investor by obtaining unlawful commissions. A similar claim, excessive trading, under FINRA’s suitability rule involves just the first two elements. Certain commonly used measures and ratios used to determine churning help evaluate a churning claim. These ratios look at how frequently the account is turned over plus whether or not the expenses incurred in the account made it unreasonable that the investor could reasonably profit from the activity.

Raymond James & Associates financial Advisor Joseph Andreoli Jr has many disputes in his 33 Year career

January 19, 2021 | by Staff Attorney

Joseph Andreoli Jr is a Financial advisor. A graduate of Ramapo College of New Jersey, Mr. Andreoli Jr holds a Bachelor of Science in business. In 1987 he started his professional career at Hym Financial, INC for a year and proceeded further on his path to work for many firms such as J.B. Hanaur & Company, Smith Barney Inc., Citigroup Global Markets Inc., Wells Fargo Clearing Services LLC and is currently working for Raymond James & Associates, Inc. Mr. Andreoli was in the securities industry for approximately 33 years.

A brokerage firm or broker-dealer is in the business of buying and selling securities- stocks, bonds, mutual funds and certain other investment products on behalf of its customer for its own bank. An investment adviser is paid for providing advice about securities to clients. In addition, some investment advisers manage investment portfolios and offer financial planning services. Mr. Andreoli Jr is licensed to sell securities in 17 states.

In or around July of 2000, Mr. Andreoli Jr had his first dispute, the allegations against him consisted of the unsuitable sale of securities, negligence, breach of contract, breach of fiduciary duties, fraud, violation of industry rules, federal securities laws, and various Texas state law statutes regarding trading of treasury bonds on margin for capital gains for a requested amount of $196,275.88. The unsuitable sale of securities occurs when a broker fails to take into account customer specific information in making a recommendation. Negligence is the failure to take proper care or carelessness. Breach of contract is the breaking of legal agreement. A breach of fiduciary duty occurs when the fiduciary acts in the interest of themselves, rather than the best returns for the client. Fraud is an intentional act to deceive for personal gain. At the conclusion of the case, the Claimant in this matter was awarded $56,555 by an arbitration panel.

Gana Weinstein LLP: In The News

October 5, 2020 | by Staff Attorney

Is Copy Trading on its way to the United States? Adam Gana of Gana Weinstein, LLP spoke with the great Edward Robinson about the pitfalls with copy trading in the United States and the legal ramifications in the article below. Happy reading to our loyal followers!

https://www.bloomberg.com/news/articles/2020-10-02/robinhood-versus-etoro-brokerage-showdown-looming-in-stock-market-investing?srnd=wealth

David Krumrey Barred Over Risky EFT and VIXX Trading – Investor Recovery

June 22, 2020 | by Staff Attorney

According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor David Krumrey (Krumrey), in January 2018, was sanctioned by FINRA and barred from the financial industry concerning his failure to respond to an investigation into the sales of leveraged exchanged traded funds (Non-Traditional ETFs). Krumrey was previously terminated by his employer Oppenheimer & Co. Inc (Oppenheimer) because he attempted to settle a complaint away from the firm. In addition, Krumrey has been subject to five customer complaints concerning his securities activity. These investors have alleged in losses stemming allegations of unsuitable Non-Tradition ETF trading.

In January 2018 FINRA barred Krumrey for failing to respond to FINRA’s requests for information.

In January 2019 a FINRA panel rendered a ruling that Krumrey’s employer – Oppenheimer – was liable for investments he made to an investor. The claims involved claims of breach of fiduciary duty, negligence, negligent supervision, respondeat superior, unjust enrichment, and violations of the Louisiana Securities Law. The causes of action relate to securities including Amarin Corp. PLC ADR and Energy XXI Limited, and exchange-traded notes issued by Barclays.

As a background, Non-Traditional ETFs behave drastically different and have different risk qualities from traditional ETFs. While traditional ETFs seek to mirror an index or benchmark, Non-Traditional ETFs use a combination of derivatives instruments and debt to multiply returns on underlining assets, often attempting to generate 2 to 3 times the return of the underlining asset class. Non-Traditional ETFs are also used to earn the inverse result of the return of the benchmark.