FINRA’s Department of Enforcement investigated Palkowitsh and alleged that from November 2008 to June 2012, Palkowitsh excessively traded and churned at least six customers’ accounts. According to FINRA, Palkowitsh typically charged a $75 commission for each transaction, and he repeatedly executed transactions that had minimal principal amounts between $100 and $300. Based upon a review of Palkowitsh’s trading activity, the result was hundreds to thousands of transactions in each account and annualized cost-to-equity ratios that exceeded 100%.
Ultimately, Palkowitsh caused $800,000 in losses to the six customers, while profiting and earning excessive commissions. To make matters worse, six of the eight accounts were Individual Retirement Accounts that constituted the bulk of the customers’ retirement savings. FINRA alleged that after the customers sustained substantial losses, Palkowitsh placed their remaining equity at risk by concentrating each account in a low-priced security.
Based upon the foregoing misconduct, FINRA alleges Palkowitsh violated FINRA Rules 2010 and 2020; NASD Conduct Rules 2110, 2120 and 2310; as well as Section 10(b) of the Securities Exchange Act of 1934, Rule l0b-5 thereunder. For example, according to FINRA, Palkowitsh failed to observe high standards of commercial honor and just and equitable principles of trade by engaging in the foregoing conduct, and thereby violated FINRA Rule 2010.
Lufrano Law, LLC is a national securities litigation firm and has experience representing investors who have investment disputes with brokers and broker-dealers. If you suffered investment damages investing with Palkowitsh through Equinox Securities, you may be able to recover your losses through FINRA arbitration. Our firm only receives a fee if you recover money. Please contact one of our attorneys at (800) 627-2179 to schedule a free consultation or complete our free case evaluator.