The law firm of Oakes & Fosher is presently investigating the alleged misconduct of former securities broker Douglas Leone. According to his publicly available FINRA BrokerCheck report, Douglas Leone has been the subject of multiple customer disputes.

Douglas Leone was a New York based securities broker. He worked in the securities industry for twenty-two years. During his career, he was registered with twelve different securities firms. He is no longer working as a registered securities broker in any fashion.

His Registrations

  • Gruntal & Co. Incorporated (1994)
  • Gaines, Berland Inc. (1994-1996)
  • Renaissance Financial Securities (1996-1997)
  • La Jolla Capital Corporation (1997)
  • Foster Jeffries Securities (1997-1998)
  • Cambridge Capital (1998-2000)
  • Whitehall Wellington Investments (2000)
  • Advanced Planning Securities (2000-2002)
  • Joseph Stevens & Company (2002-2005)
  • Basic Investors (2005-2008)
  • Newport Coast Securities (2008-2013)
  • Salomon Whitney Financial (2013-2017)

The Allegations

  • In July 1999, a customer alleged that Douglas Leone made material misrepresentations, engaged in fraud, breached contract, breached his fiduciary duty, and recommended unsuitable securities. This case was settled for $125,000 in damages.
  • In April 2002, a customer alleged that Douglas Leone executed unauthorized trades. This case was settled for $4,218 in damages.
  • In February 2006, Douglas Leone was accused of charging excessive commissions. This case was settled for $21,000 in damages.
  • In April 2012, a customer alleged that Douglas Leone churned their account, made material misrepresentations, and breached his fiduciary duty. This case was settled for $9,999 in damages.
  • In March 2012, a customer alleged that Douglas Leone breached his fiduciary duty, handled their account negligently, and breached contract. This case was settled for $70,000 in damages.
  • In January 2018, he was officially sanctioned by FINRA. This followed allegations that he failed to provide FINRA with its requested on-the-record testimony during an investigation into allegations that Leone made unsuitable recommendations and took part in excessive trading involving multiple customers. Due to these allegations, he was barred by FINRA from acting as a securities broker in any fashion.
  • In April 2019, a customer alleged that Douglas Leone engaged in excessive margin trading, made false and misleading statements regarding investment risks, churned their account, breached his fiduciary duty, breached contract, and recommended unsuitable securities. This case is currently pending. The customer is seeking $250,000 in damages.

Unsuitable Investment Recommendations

Securities brokers have an obligation to investors to only recommend securities that they are financially suited for. Securities brokers are expected to conduct the necessary due diligence that is required to determine suitability by looking at factors like the investor’s liquidity needs, risk tolerance, investment objectives, and financial situation.When securities brokers place investors in investments they are not suited for, they can often incur substantial trading losses. Securities brokers cannot excuse themselves by claiming they were unaware of an investment’s suitability.

Excessive Trading

Securities brokers are obligated to trade their customers’ accounts suitably both in the trades they recommend and the frequency in which they execute trades. When securities brokers like Douglas Leone trade their customers’ accounts excessively, it can often cause them to incur highly unnecessary fees and trading losses. Despite this, many brokers will trade investor accounts in this fashion because it increases their commissions. When a securities brokers trades an investors’ account excessively with the express purpose of generating additional commissions for themself, it is referred to as churning. This is a fraudulent, deceptive trading practice that serves no benefit to the investor.

Oakes & Fosher Can Help

Many investors are unaware of the legal recourse available to them after losing money due to securities broker negligence and/or fraud. The truth is that investors who have lost money in this fashion may actually be entitled to damages.

Oakes & Fosher dedicates its entire legal practice to helping investors across the nation. If you, or someone you know, have lost money investing with Douglas Leone, please contact Oakes & Fosher for a free and private consultation. Oakes & Fosher handles cases on a contingency basis, which means there are no fees charged unless we collect for you.

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