Stuart James Siegel, a former Bradenton, Florida-based registered representative employed by Morgan Stanley, was named a respondent in a Financial Industry Regulatory Authority (FINRA) complaint alleging conversion of funds. Mr. Siegel was appointed president of a foundation established after the death of one of his customers and opened a brokerage account at his firm to fund its activities. FINRA’s complaint alleges that Mr. Siegel obtained his firm’s permission to serve as president, but firm policies prohibited him from receiving any compensation and from serving as the registered representative for the foundation’s brokerage account. In addition to Mr. Siegel’s duty to review grants, donations, and placing trades, he had access to the foundation’s checking account, could withdraw funds, and had authority to use its debit card. Mr. Siegel allegedly converted more than $76,000 of the foundation’s funds to repay personal loans, pay his children’s school tuition, and pay personal life insurance policy premiums without informing or seeking permission from foundation officers or board members. After Morgan Stanley discovered the alleged conversion, Mr. Siegel reimbursed the foundation for the expenditures.
Stockbrokers, registered representatives, and other financial industry personnel have been known to engage in many types of fraud and other violations of industry rules, practices, and procedures. In order to protect customers from broker misconduct, FINRA rules require broker-dealers to establish and implement a reasonable supervisory system. The implementation of the rules requires supervisors to monitor employees to ensure they comply 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 do not establish and implement such protective measures, they may be a liable to account holders for damages flowing from the misconduct. As a result, account holders who have suffered losses stemming from misappropriations, conversion or other types of misconduct by their registered representative or broker can bring forth claims to recover damages against broker-dealers like Morgan Stanley, which have a duty to oversee its employees in order to prevent these types of stockbroker misconduct.
Have you suffered losses in your investment account due to your registered representative or stockbroker’s misconduct? 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 stockbrokers for unsuitable recommendations, misrepresentations, and/or other unauthorized and illegal conduct.
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 , 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.