FINRA Reportedly Suspends Broker Jeffrey Stanga in connection with Alleged Outside Business Activities
According to public records, the Financial Industry Regulatory Authority (FINRA) has suspended financial advisor Jeffrey D. Stanga (CRD #6387255) from the securities industry and ordered him to pay a $10,000 fine plus $28,359.00 in restitution.
Stanga reportedly failed to fully disclose the nature of his outside business activities, according to a Letter of Acceptance, Waiver and Consent. Stanga reportedly sold a private placement offering of membership units in connection with a residential real estate flipping business prior to his registration with his member firm.
Although Stanga provided written notice to the firm on his Form U4, describing his involvement as an “investor, gives advice/opinions on buying/fixing/selling residential homes,” he allegedly failed to fully disclose his role as “manager,” and that the business was an investment-related business.
FINRA said that Stanga participated in private securities transactions without providing the required written notice to, or receiving written approval from, the firm. Apparently Stanga also sold promissory notes to investors in connection with a real estate brokerage firm prior to his registration with FMN. Further, Stanga participated in private securities transactions totaling $1,160,000 after he began working for FMN, facilitating the renewals of the real estate brokerage promissory notes.
Stanga reportedly received $28,359 in referral fees in connection with the promissory note renewals for investors (one of whom was a firm customer).
Jeffrey Stanga’s broker report indicates that he has been registered with FMN Capital Corporation in Mission Viejo, CA since October 2014.
According to his broker profile, Stanga’s outside business activities include Red Cedar Residential, LLC and Scevro Finance.
Stanga reportedly has two customer complaints filed against him in January 2018, according to his broker profile. One customer was awarded $75,000 after sales of an allegedly unsuitable investment. The damage amount requested was $150,000. The other complaint settled for $46,000, and the damage amount requested was $225,000 for allegations of sales of “unsuitable product to client.” According to the Broker Comments in his profile Stanga claims “The individual bringing arbitration never was a client of FMNCC and product was sold by Jeff Stanga prior to joining FMNCC,” in connection with both complaints.
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The White Law Group is investigating potential securities fraud claims involving Jeffrey Stanga and the liability his former employers may have for failure to properly supervise him.
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, 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.
If you are concerned about investments with Jeffrey Stanga and FMN Capital Corporation, the securities attorneys at The White Law Group may be able to help you. Please call 888-637-5510 for a free consultation, or visit us on the web at www.whitesecuritieslaw.com.
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.