Joseph Gunnar

Advisor James Schwartz Subject to Multiple Churning Claim

January 23, 2019 | by Staff Attorney

According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker James Schwartz (Schwartz) has been subject to nine customer complaints, one tax lien, and one bankruptcy during his career. Schwartz is currently not registered but was previously employed by Joseph Gannar & Co. LLC (Joseph Gunnar). Many of the the customer complaints against Schwartz concern allegations of high frequency trading activity also referred to as churning and unsuitable investments.

In October 2018 a customer filed a complaint alleging that Schwartz violated the securities laws by engaging in breach of fiduciary duty, unsuitable investments, and negligence causing $32,871.30 in damages. The claim is currently pending.

In May 2018 a customer filed a complaint alleging that Schwartz violated the securities laws by engaging in churning, unsuitable investments, unauthorized trading, and breach of fiduciary duty causing $150,000 in damages. The claim is currently pending.

In February 2018 a customer filed a complaint alleging that Schwartz violated the securities laws by engaging in unsuitable investments and unauthorized trading causing $1,694,099 in damages. The claim is currently pending.

In addition, Schwartz has one financial disclosure concerning a tax lien for $15,667 and declared bankruptcy in June 2017. This information has been found to be material for investors to have because an advisor who cannot manage his own finances is a relevant factor for investors to consider. In addition, a broker in financial distress may be influenced to recommend high commission products or strategies.

Anthony Sica Subject to Multiple Regulatory Sanctions and Customer Complaints

June 9, 2018 | by Staff Attorney

According 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.

When brokers engage in excessive trading, sometimes referred to as churning, the broker will typical 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.

Advisor Robert Estevez Subject to Multiple Regulatory Actions

February 13, 2017 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Robert Estevez (Estevez). According to BrokerCheck records there are at least 9 disclosures on Estevez’s record including customer complaints, multiple regulatory actions, and one judgments or liens among other claims. Some of the regulatory actions expressed concerns over Estevez’s ability to manage his own personal finances. Substantial financial disputes on a broker’s record can reveal a financial incentive for the broker to recommend high commission products or services. A broker’s inability to handle their personal finances has also been found to be relevant in helping investors determine if they should allow the broker to handle their finances. The most recent regulatory action against Estevez was filed by the State of Michigan which is currently pending and remains unresolved at this time.

In September 2016,FINRA alleged that Mr. Estevez recommended unsuitable short-term steepener transactions to his customers, which are highly complex investment products that profits from the difference between short and long term rates. FINRA claims that the market for steepeners are known to have an illiquid nature, making them unsuitable for most customers. This investment strategy resulted in approximately $24,000 in customer loss. Estevez was issued a penalty of $20,000 and suffered a two-month suspension.

In January 2013 the State of New Hampshire issued a Cease and Desist Order to deny Estevez’s securities agent registration in that state.

Broker John Cangialosi Sanctioned by Multiple Regulators

November 18, 2016 | by Staff Attorney

Investment attorneys at Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against John Cangialosi (Cangialosi) alleging unsuitable investments, fraudulent and negligent acts, breach of contractual requirements, churning, and negligent misrepresentation among other claims. According to brokercheck records Cangialosi has been subject to five customer complaints, two financial disclosure – one bankruptcy and one tax liens, one employment separation for cause, and two regulatory events.

In April 2013, FINRA found that Cangialosi violated FINRA rules that require the timely disclosure judgments or liens. In this case FINRA found that Cangialosi failed to timely disclose six liens and fined him $5,000 and suspended Cangialosi for three months. In January 2016 the state of Michigan denied Cangialosi’s application to engage in securities business in the state on the grounds that Cangialosi engaged in dishonest and unethical practices within the last 10 years supporting the denial of his registration application.

In 2009 J.P. Turner & Company, LLC permitted Cangialosi to resign after allegations were made that the broker engaged in unauthorized trading in a client’s account.

Gana LLP Investigation: Legend Securities Broker Peter Girgis

July 27, 2015 | by Staff Attorney

According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Peter Girgis (Girgis) has been the subject of at least three customer complaints, several unreported judgement or liens, one employment separation following allegations by his brokerage firm, and two regulatory actions taken by FINRA. Customers have filed complaints against Girgis alleging a number of securities law violations including that the broker made unsuitable investments, fraud, churning (excessive trading), breach of fiduciary duty, and unauthorized trading among other claims.

Bergen entered the securities industry in 2002. From August 2006 until November 2009, Girgis was registered with J.P. Turner & Company, L.L.C. (JP Turner). From there, Girgis was associated with Brookstone Securities, Inc. until June 2012. Thereafter, Girgis was a registered representative of Joseph Gunnar & Co. LLC from June 2012 until June 2013. Finally, Girgis is currently registered with Legend Securities, Inc.

In one of the FINRA actions, FINRA alleged that, while registered through Joseph Gunnar, Girgis caused a violation of Regulation S-P of the Securities Exchange Act of 1934 on the part of his employer firm by sending nonpublic personal information about a customer to an unauthorized individual. In the second FINRA action, the regulator alleged that between February 2011 and January 2013, Girgis failed to disclose and/or timely disclose on his Form U4 four unsatisfied judgments and/or liens including a January 2011 New York income tax warrant of approximately $4,488; a January 2011 New York income tax warrant of approximately $13,418; a November 2011 New York income tax wan-ant of approximately $2,524; and a March 2011 federal income tax warrant of approximately $30,635. Subsequent to these allegations Joseph Gunnar terminated Girgis alleging that the broker violated the conditions of the FINRA action.

Broker Spotlight: Broker Christopher Orlando

July 24, 2015 | by Staff Attorney

According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Christopher Orlando (Orlando) has been the subject of at least two customer complaints, and one judgement or lien. Customers have filed complaints against Orlando alleging a number of securities law violations including that the broker made unsuitable investments, misrepresentations, and exorbitant commissions and fees among other claims.

Orlando entered the securities industry in 2002. From August 2006 until November 2009, Orlando was registered with J.P. Turner & Company, L.L.C. (JP Turner). From there, Orlando was associated with Brookstone Securities, Inc. until June 2012. Thereafter, Orlando was a registered representative of Joseph Gunnar & Co. LLC from June 2012, until December 2013. Finally Orlando was registered with National Securities Corporation from December 2013 until July 2015.

It is important for investors to know that all advisers have an obligation and responsibility to deal fairly with investors including making suitable investment recommendations. In order to make suitable recommendations the broker must have a reasonable basis for recommending the product or security based upon the broker’s investigation of the investments properties including its benefits, risks, tax consequences, and other relevant factors. In addition, the broker must also understand the customer’s specific investment objectives to determine whether or not the specific product or security being recommended is appropriate for the customer based upon their needs.