Aegis Capital to Pay $2.8 Million Over Supervisory Failures After FINRA Settlement

Posted on November 15th, 2021 at 11:37 AM
Aegis Capital to Pay $2.8 Million Over Supervisory Failures After FINRA Settlement

From the Desk of Jim Eccleston at Eccleston Law:

After agreeing to a settlement with the Financial Industry Regulatory Authority (FINRA), Aegis Capital will pay $1.7 million in restitution to clients as well as a $1.1 million fine after the firm allegedly failed to oversee advisors who orchestrated potentially unsuitable trades. 

FINRA’s investigation uncovered Aegis Capital’s failure to create a supervisory system designed to comply with FINRA’s suitability requirements between July 2014 and December 2018. According to FINRA, the lack of supervision enabled eight Aegis advisors to excessively trade in at least 68 client accounts, which generated nearly $2.9 million in trading fees. FINRA’s investigation additionally prompted the regulator to fine and suspend two Aegis supervisors, Joseph Giordano and Roberto Birardi, according to BrokerCheck. Giordano agreed to a six-month suspension accompanied by a $10,000 fine while Birardi received a three-month suspension and $5,000 fine. 

Furthermore, both supervisors will be required to complete 20 hours of continuing education, according to FINRA. Between July 2014 and December 2018, Aegis failed to provide supervisory training for branch managers and assistants instead relying on boilerplate written supervisory procedures, according to FINRA. 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

 

Tags: eccleston, eccleston law, finra, settlement

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