FINRA’s Department of Enforcement investigated Plemenos’ alleged misconduct and found he exercised discretion and unauthorized trades in five of his customers’ non-discretionary accounts. According to FINRA, Plemenos effected discretionary trades in the accounts of five customers without obtaining prior written authorization from the customer and without acceptance of the account as discretionary by Merrill Lynch. In addition, Plemenos allegedly provided false responses on two annual compliance questionnaires, which indicated he had not exercised discretion.
Based upon the foregoing misconduct, FINRA alleged Plemenos violated NASD Rule 2510(b), as well as FINRA Rule 2010. For example, NASD Rule 2510 prohibits a registered representative from exercising any discretionary authority in a customer’s account unless such customer has provided prior written authorization and the account has been accepted by a FINRA member. In cases where a financial advisor executes unauthorized trades without proper authorization, the financial advisor and brokerage firm may be found liable, as well as disciplined by securities regulators such as the case here.
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 with Plemenos through Merrill Lynch, you may be able to recover your losses through FINRA arbitration. Please contact us for a free, no-commitment initial consultation or contact one of our attorneys at (800) 627-2179 to schedule a free consultation or complete our free case evaluator.