Securities Lawyers Blog
Securities 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.
Brokers are not allowed to engage in unauthorized trading in non-discretionary customer accounts. 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). If a customer’s account is indeed discretionary, there must be legal documentation such as a power of attorney to confirm the customer’s approval and knowledge of the discretionary status of the account. Brokers are also obligated to accurately maintain their firm’s books and records. FINRA rule 4511 mandates that brokers accurately record information in books so that the firm can properly supervise broker’s business activities.
Destefano entered the securities industry in 2005. From May 2014 to February 2015, Destefano was registered with Securities America, Inc. From October 2009 to May 2014, Destefano was registered with Merrill Lynch. From November 2009 to October 2009, Destefano was registered with Banc of America Investment Services, Inc. From August 2006 to November 2008, Destefano was registered with Wachovia Securities, LLC. From May 2005 to June 2006, Destefano was registered with Morgan Stanley DW Inc.
Investors who have suffered losses may be able recover their losses through securities arbitration. The attorneys at Gana Weinstein LLP are experienced in representing investors in cases of unauthorized trading and of brokerage firms failure to supervise their representatives. Our consultations are free of charge and the firm is only compensated if you recover