The law firm of Oakes & Fosher is presently investigating the possible misconduct of securities broker Edward Herbst. According to his publicly available FINRA BrokerCheck report, Edward Herbst has been the subject of multiple customer disputes over the course of his career.

Edward Herbst is a New York based securities broker. He has worked in the securities industry for forty-nine years. During his career, he has been registered with six different securities firms.

His Registrations

  • Drexel Burnham & Co. (1970-19783)
  • Cowen & Co. (1983-1998)
  • SG Cowen Securities Corporation (1998-1999)
  • Dominick & Dominick (1999-2001)
  • Shields & Company (2001-2009)
  • Wellington Shields & Co. (2009-Present)

The Allegations

  • In February 1999, claimants alleged that Edward Herbst purchased a derivative security without prior authorization. The customer also alleged that Edward Herbst recommended unsuitable securities, churned their account, and engaged in fraud. This case went to arbitration where the claimants were awarded $3.8 million.
  • Also in February 1999, claimants alleged that Edward Herbst excessively traded their account, engaged in unsuitable trading, and charged them excessive commissions. This case was settled for $500,000.
  • In May 1999, a customer alleged that Edward Herbst engaged in unsuitable trading and excessive use of margin. This case was settled for $850,000.
  • In November 1999, a customer alleged that Edward Herbst engaged in unsuitable trading, excessive trading, unauthorized trading, and made misrepresentations and omissions of material facts. This case was settled for $330,000.
  • In February 2018, a customer alleged that they purchased three Puerto Rico issues in 2013, then sold them in 2014 as part of a swap on Edward Herbst’s recommendation, in which they purchased two new issues. The two bonds the customer purchased in 2014, were sold at a loss in 2017. The client is requesting to be reimbursed for the loss totaling $88,364.

Unsuitable Trading

Securities brokers have a duty to their customers to always act in their best financial interests. The main part of this duty being that they are to only recommend securities to their customers that they are financially suited for. Brokers can determine if a particular investment is suitable for an investor by looking at their investment objectives, financial situation, risk tolerance, and liquidity needs. There are also various trading strategies that are unsuitable for any investor. These usually take place when less than scrupulous or incompetent securities brokers recommend to their customers that they switch their held positions to something with very short-term gains.

Oakes & Fosher Can Help

Many investors are unaware of the legal recourse available to them after losing money due to securities broker fraud and/or negligence. 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 Edward Herbst, please contact Oakes & Fosher for a free and private consultation. We handle cases on a contingency basis, which means there are no fees charged unless we collect for you.