FINRA’s Department of Enforcement investigated Cannata’s alleged misconduct and found he excessively trading three customer accounts from March 2012 to April 2014. FINRA alleged Cannata recommended a speculative and aggressive short-term strategy whereby he purchased securities for client accounts in companies just prior to earnings announcements and then sold the stock immediately thereafter. According to FINRA, between July 2013 and April 2014, Cannata engaged in 1,680 trades in one customer’s account that generated close to $700,000 in commissions and fees.
Based upon the foregoing alleged misconduct, FINRA found Cannata violated NASD Conduct Rule 2310, FINRA Rules 2010, 2020, 2111 and 8210, as well as Section 10(b) of the Securities Act of 1934 and Rule 10b-5 thereunder. For example, NASD Conduct Rule 2310 requires that “in recommending to a customer the purchase, sale or exchange of any security, a member shall have reasonable grounds for believing that the recommendation is suitable for such customer upon the basis of the facts, if any, disclosed by such customer as to his other security holdings and as to his financial situation and needs.”
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 losses investing with Cannata through Craig Scott Capital, you may be able to recover your losses through FINRA arbitration. Our firm only receives a fee if you recover money. Please complete the contact form below or contact one of our attorneys at (800) 627-2179 to schedule a free consultation or complete our free case evaluator.