According to a publicly available document from the Financial Industry Regulatory Authority (FINRA), the firm Bluechip Securities, Inc. was fined $15,000 and censured by FINRA for alleged fraudulent actions of their former employee Mohammed Akram Khan. Khan himself was suspended from association with any FINRA firm for a period of 18 months and fined $385,000. The document further states that, “Without admitting or denying the findings, the firm and Khan consented to the described sanctions and to the entry of findings that Khan engaged in excessive trading in the accounts of his member firm’s customers.”
FINRA found during their investigation that “Khan effected transactions and generated approximately $380,296 in commission charges. The findings stated that the customers’ accounts incurred losses of approximately $399,000…The findings also stated that Khan executed, or caused the execution of, options transactions at prices that were unfair, in that the commissions charged on such transactions were excessive in light of all factors relevant to the transactions…[They] also included that Khan recommended opening options transactions to his firm’s customers without having reasonable grounds to believe that the recommended transactions were suitable for the customers; further, Khan did not have a reasonable basis for believing that the customers had such knowledge and experience in financial matters that they could reasonably be expected to be capable of evaluating the risks of the transactions, and that they were financially able to bear the risks of the recommended positions in the options contracts.” Finally, FINRA also reported that “Khan executed discretion in executing options transactions in customers’ accounts” however, “none of the customers provided Khan or the firm with written authorization to exercise discretion in their accounts…”
If you have questions about investments you made Mohammad Akram Khan and Bluechip Securities, Inc., the securities attorneys of The White Law Group may be able to help. To speak with a securities attorney, please call the firm’s Chicago office at (312) 238-9650.
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