March 23, 2022 Comments Off on New York Broker Marc Reda, Spartan Capital, Charged with Churning Clients’ Accounts   Blog, Current Investigations, Securities Fraud

New York Broker Marc Reda, Spartan Capital, Charged with Churning Clients’ Accounts  

New York Broker Marc Reda, Spartan Capital, Charged with Churning Clients’ Accounts, featured by top securities fraud attorneys, the White Law Group

Marc Reda Allegedly Recommended Unsuitable Trading Strategy to Clients

According to a document posted this week by the Financial Industry Regulatory Authority (FINRA), Broker Marc A. Reda (CRD#: 2757330) reportedly submitted an Offer of Settlement to the previous charges filed against him and is barred from working in the securities industry.  

According to a FINRA complaint filed on June 15, 2021, from January 2017 to December 2019, while affiliated with Spartan Capital Securities, LLC, Reda allegedly recommended to all of his customers an unsuitable investment strategy that consisted of actively trading in anticipation of corporate announcements. FINRA says that Reda purportedly failed to consider that the substantial commissions and costs made it unlikely his customers could profit from his strategy. Consequently, Reda’s alleged investment strategy and its high total costs reportedly harmed his customers, according to FINRA.  

According to the complaint, within the 66 customer accounts in which Reda executed ten or more trades in connection with his unsuitable investment strategy Reda allegedly charged $952,764 in commissions and fees while the customers reportedly lost $934,482. Fifty-four of those 66 accounts, or 82 percent, allegedly experienced cost-to-equity ratios of 20 percent or more during the specified time period.  

Reda’s investment strategy was also allegedly unsuitable for three of his customers based on their specific investment objectives, risk tolerance, and financial needs, according to the complaint.  

Further, Reda purportedly executed 98 trades in connection with his strategy in the accounts of six customers without first obtaining authorization from the customers.   

Reda also purportedly charged excessive commissions averaging 8.6 percent on the “proceeds” transactions in September 2018, after executing buy transactions in 22 customer accounts.   

The regulator alleges that Reda intentionally waited three days to execute the buy transactions to circumvent his firm’s supervisory review of commissions of more than five percent on proceeds transactions and allegedly failed to disclose eight customer complaints alleging sales practice violations.   

Reda also purportedly willfully failed to disclose an unsatisfied tax lien and an unsatisfied tax warrant, totaling $225,929.49.  

Marc Reda was reportedly affiliated with the following firms during his twenty-two-year career, among others, according to FINRA:    

 05/12/2016 – 03/22/2022, SPARTAN CAPITAL SECURITIES, LLC (CRD#:146251), NEW YORK, NY,   

02/22/2016 – 05/02/2016, FIRST STANDARD FINANCIAL COMPANY LLC (CRD#:168340), STATEN ISLAND, NY  

10/03/2014 – 01/28/2016, PHX FINANCIAL, INC. (CRD#:144403), NEW YORK, NY  

11/21/2013 – 10/31/2014, LAIDLAW & COMPANY (UK) LTD. (CRD#:119037), NEW YORK, NY  

According to his broker record, Reda reportedly has twenty (20) disclosure events, including 13 investor disputes, 2 regulatory actions, a pending bankruptcy and two employment separations, among others.

To learn more about the investigation, please see: FINRA Complaint: Marc Reda of Spartan Capital, Charged with Broker Misconduct

Potential Lawsuits to Recover Financial Losses      

The White Law Group is investigating potential securities fraud lawsuits regarding the liability that Marc Reda’s employers may have for failure to properly supervise him.        

When brokers violate securities laws, such as making unauthorized transactions or unsuitable investments, the brokerage firm they are working with may be liable for investment losses through FINRA Arbitration. 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 White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Seattle, Washington.  We represent investors in FINRA arbitration claims in all 50 states including New York. Our attorneys have recovered millions of dollars from many brokerage firms in the past.        

If you are concerned about your investments with Marc Reda, please call the securities fraud attorneys at The White Law Group at 888-637-5510 for a free consultation.         

For more information on The White Law Group, and its representation of investors, please visit www.WhiteSecuritiesLaw.com.         

         

 

 

 

 

 

 

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