FINRA Reportedly Bars Salvatore Pizzimenti after Customer Complaints Allege Churning, Unsuitability
According to public documents posted on June 11, 2021, the Financial Industry Regulatory Authority (FINRA) has barred Worden financial advisor Salvatore Pizzimenti in connection to an investigation into his trading of customer accounts.
Pizzimenti reportedly failed to provide testimony in FINRA’s investigation and consequently was barred from the securities industry, according to a Letter of Acceptance, Waiver and Consent.
According to his broker profile, Pizzimenti was registered with Worden Capital Management in New York, NY from November 2016 until December 2019.
He reportedly has five customer complaints filed against him since 2008, according to FINRA. Allegations include churning or excessive trading, unsuitable investments, negligence, misrepresentation, fraud and breach of fiduciary duty. Most recently, two complaints were reportedly filed earlier this year, and one is still pending, according to FINRA.
Churning or Excessive Trading is Illegal
Churning is when a broker engages in excessive buying and selling (i.e., trading) of securities in a customer’s account without considering the customer’s investment goal, and primarily to generate commissions that benefit the broker. Churning is an illegal practice.
Often churning or excessive trading occurs when a broker has discretionary authority (either actual or implied) of a client’s account, meaning they do not need the clients consent to trade on their behalf. Churning may result in significant losses and exposes the client to unnecessary tax liabilities.
While there is no quantitative measure for churning fraud, brokers must follow FINRA rules intended to prevent such practices.
Potential Lawsuits to Recover Financial Losses
Brokerage firms are required to adequately supervise their advisors. They must ensure they are complying with FINRA rules.
When brokers abuse client accounts and conduct transactions that violate securities laws, such as churning accounts or making unsuitable investments, the brokerage firm they are working with may be liable for investment losses. Brokerage firms that fail to monitor the business activities of their employees may be liable for investment losses due to negligent supervision for the misconduct of their employees.
The brokerage firms can be held responsible for any losses in a FINRA arbitration claim if it is determined that they failed to properly supervise their agent.
If you are concerned about investments with Salvatore Pizzimenti and Worden Capital Management, the securities attorneys at The White Law Group may be able to help you. For a free consultation with an attorney, please call (888) 637-5510.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois. For more information, please visit our website, www.whitesecuritieslaw.com.