Adam R. Tau, a former broker with the New York branch of Garden State Securities, Inc., submitted a letter of Acceptance, Waiver, and Consent in which he consented to, but did not admit to or deny, the Financial Industry Regulatory Authority’s (FINRA) findings that he made unsuitable recommendations to a customer which resulted in substantial losses in the customer’s account.
FINRA found that Adam Tau made recommendations to his customer that were unsuitable given his customer’s conservative investment objectives, risk tolerance, and limited assets and income. Mr. Tau recommended five purchases of common stock totaling approximately $204,000. During the relevant time period, the stock experienced several price declines which resulted in a loss of approximately $30,000. Additionally, FINRA found that Mr. Tau exercised discretion in his customer’s account by effecting ten trades without obtaining the necessary written authorization from his customer and neglecting to obtain the written acceptance of the account as discretionary by Garden State Securities.
Consequently, Adam R. Tau, of Brooklyn, New York was fined $7,500 and suspended from association with any FINRA member in any capacity for two months. The suspension was in effect from January 4, 2016 through March 3, 2016.
Stockbrokers, registered representatives, and other financial industry professionals have been known to engage in many types of misconduct which are in violation of industry rules and procedures. In order to protect customers from such misconduct, FINRA rules require broker-dealers to establish and implement a reasonable supervisory system. The implementation of these rules requires supervisors to monitor its employees to ensure compliance with federal and state securities laws, securities industry rules and regulations, as well as the brokerage firm’s own policies and procedures. If broker dealers and their supervisors fail to establish and implement these protective measures, they may be held liable to account holders for losses flowing from the employees’ misconduct. As a result, account holders who have suffered losses stemming from unsuitable recommendations, unauthorized securities transactions or other misconduct by their broker or registered representative can bring forth claims to recover damages against broker-dealers like Garden State Securities, which have a duty to supervise its employees in order to prevent broker misconduct.
Have you suffered losses in your Garden State Securities investment account due to your registered representative or stockbroker’s unsuitable recommendations or unauthorized securities transactions? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against Garden State Securities financial professionals for unsuitable recommendations, unauthorized securities transactions, and other types of stockbroker misconduct.
The most important of investors’ rights is the right to be informed! This Investors’ Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 40 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities, and investment law issues. The lawyers at our law firm are devoted to protecting investors’ rights throughout the United States and internationally! Please post a comment, call (800) 732-2889, send Mr. Pearce an email at firstname.lastname@example.org, and/or visit our website at www.secatty.com for answers to any of your questions about this blog post and/or any related matter.