Garden State Securities Broker Suspended for Unauthorized Trading
Terry Lee Brodt Jr., of Red Bank, New Jersey, a stockbroker currently registered with Garden State Securities, Inc., has been fined $10,000.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that he effected trades in customer accounts on a discretionary basis, and failed to accurately disclose his activities to his firm. Letter of Acceptance, Waiver and Consent, No. 2012030677102 (May 12, 2017).
According to the AWC, from August of 2010 to June of 2012, discretion was exercised by Brodt in fourteen of Garden State Securities’ accounts held by eight of the firm’s customers. Apparently, Brodt effected transactions without having first retrieved approval from customers. Moreover, the firm never provided Brodt with approval for discretion to be exercised in the customers’ accounts. Consequently, FINRA found Brodt’s conduct to be violative of FINRA Rule 2010 and NASD Rule 2510(b).
Brodt evidently failed to accurately attest to his exercising of discretion in the affected customer accounts. Particularly, during the time in which he effected trades on a discretionary basis, Brodt stated that he never maintained any authority to exercise discretion in customer accounts and had not actually traded without customer approval. FINRA found Brodt’s misstatements in this regard to be violative of FINRA Rule 2010.
Financial Industry Regulatory Authority (FINRA) Public Disclosure reveals that Brodt has been identified in five additional customer initiated investment related disputes containing allegations of his misconduct while associated with Morgan Stanley, Dean Witter, Invest Financial Corporation, and Garden State Securities, Inc. Specifically, on June 9, 2010, a customer filed an investment related written complaint involving Brodt’s conduct, where the customer requested $5,000.00 in damages based upon allegations that Brodt effected unsuitable real estate security and over-the-counter equity transactions in the customer’s account.
Subsequently, on December 11, 2013, a customer initiated investment related arbitration claim regarding Brodt’s activities was resolved for $24,900.00 in damages based upon allegations that Brodt placed stock trades in the customer’s account that were neither appropriate for the customer nor effected with the customer’s consent. On December 6, 2012, another customer filed an investment related written complaint involving Brodt’s conduct, in which the customer requested $47,950.00 in damages based upon allegations that Brodt effected unsuitable equity transactions in the customer’s investment account.
Further, on January 18, 2017, a customer initiated investment related written complaint regarding Brodt’s activities was resolved for $120,000.00 in damages based upon allegations that Brodt, from 2012 to 2015, charged excessive commissions regarding over-the-counter equity transactions, churned the customer’s account, and caused the customer to sustain equity investment losses.
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