Securities Lawyers Blog
According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker John Mickelson (Mickelson), currently associated with Creativeone Securities, LLC, has been subject to at least one disclosable event. These events include one customer complaint. Several of those complaints against Mickelson concern allegations of high frequency trading activity also referred to as churning or excessive trading among other securities laws violations.
FINRA BrokerCheck shows a pending customer complaint on February 27, 2025.
In a practice known as churning, brokers may execute numerous trades, occasionally involving the same stock, over a brief span. Every month, part of the account are replaced by different securities. The sole beneficiary of this kind of investment trading activity is the broker, who profits from the commissions generated by these trades, which serve no meaningful purpose for the investor. Churning is regarded as a specific category of securities fraud. The claim is based on excessive securities trading, the broker’s control over the account, and a fraudulent scheme to extract unlawful commissions from the investor. 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.
