Finra panel directs N.J.'s Garden State Securities to pay damages to elderly investor

The brokerage firm must pay $142,168 due to allegations of unsuitable investments and overtrading

Jul 8, 2016 @ 12:01 am

By Christine Idzelis

An elderly client was awarded $142,168 by a Financial Industry Regulatory Authority Inc. arbitration panel as a result of claims that his brokerage firm, Garden State Securities Inc., had put him into unsuitable investments and had overtraded his account.

Anthony Romano, who's in his late 70s, lost money due to such unsuitable investments as penny stocks, stocks of Chinese-owned companies, and leveraged exchange-traded notes, according to the attorneys representing him, Adam Nicolazzo and Robert Van De Veire of Malecki Law in New York.

“They were really boom or bust products,” said Mr. Van De Veire, adding they weren't appropriate for a senior investor concerned about his monthly expenses.

In addition to shifting his investments into more speculative stocks, Mr. Van De Veire said the costs associated with trading in the account were too high. In his statement of claim, Mr. Romano requested at least $142,168 in compensatory damages plus punitive damages, attorneys' fees and other costs, according to a Finra dispute resolution document dated July 5. At the close of the arbitration hearing in New York, he sought $214,349 in compensatory damages, while requesting $72,982 in punitive damages plus attorneys' fees and other costs, the document shows.

Mr. Romano was awarded $142,168 and denied any other relief.

“Garden State Securities disagrees with the award and is disappointed the arbitrators saw fit to award any damages in this case,” said Ian Frimet, a partner at Wexler Burkhart Hirschberg & Unger who is representing the brokerage firm. “Even though the arbitrators awarded only 66% of the damages claimant sought, and denied the request for attorneys' fees, punitive damages and costs, we believe any award was unjustified,” he said.

Steven Trigili, chief compliance officer at Red Bank, N.J.-based Garden State Securities, didn't return phone calls and an email seeking comment about the Finra arbitration award.

0
Comments

What do you think?

View comments

Most watched

Events

MassMutual's LaPianna: Creating better conversations with your clients

What's the secret to building better client relationships? MassMutual's Paul LaPianna says it all begins with great conversations.

INTV

How advisers can be a gamechanger for women investors

Why women defer to men when it comes to finances and how advisers can combat this phenomenon and make a difference for female investors, according to Heather Ettinger, founder and CEO Luma Wealth Advisors.

Latest news & opinion

Finra reaches settlements with 56 firms for overcharging customers on mutual funds

Regulator obtained $89 million in restitution as a result of the crackdown.

Schorsch, AR Capital to pay $60 million to settle SEC charges

The former REIT czar and his firm wrongfully obtained millions linked to REIT mergers.

CFP Board postpones enforcement of its revised fiduciary standard

Board's new Code of Ethics and Standards to be enforced next June, in line with the SEC's Reg BI

Charles Schwab reportedly in talks to buy USAA brokerage, wealth management business

The deal would net Schwab roughly $100 billion in new assets.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print