James Michael Kennedy Allegedly Engages In Unauthorized Discretionary Trading

The law firm of Oakes & Fosher is presently investigating the alleged misconduct of former securities broker James Michael Kennedy. According to his publicly available FINRA BrokerCheck report, James Michael Kennedy has been the subject of a customer dispute.

James Michael Kennedy was an Illinois based securities broker. He worked in the securities industry for thirty-six years. During his career, he was registered with six different securities firms. He is no longer working as a registered securities broker in any fashion.

His Registrations

• Dean Witter Reynolds (1978-1979)


• Lehman Brothers Kuhn Loeb Incorporated (1979-1982)


• Bear, Stearns & Co. (1982-1984)


• Associated Investment Services (1986-2002)


• Saxony Securities (2003-2015)


• Securities America (2015-2017)

The Allegations

• In March 2016, a customer alleged that James Michael Kennedy recommended unsuitable investment strategies. The alleged transgressions taking place between July 2011 and January 2015. This case was settled for $350,000 in damages.


• In November 2017, he was officially sanctioned by FINRA. The findings in this matter state that he exercised discretion in non-discretionary accounts without written authorization from the customer of approval from his member firm. Due to the alleged actions, he was fined $5,000 and suspended for a period of fifteen business days.

What Does This Mean?

Securities brokers are required to obtain their customer's authorization before executing transactions on their behalf. Just because an investor has hired a securities broker to recommend investments to them, does not mean they have forfeited the right to ultimately decide what investments they purchase.

There is a trading practice known as discretion that allows securities brokers to execute trades on an investor's behalf without having to have every single trade authorized. However, before a broker can begin engaging in this practice, they must first receive express written authorization from the account holder. They must also have their member firm accept the account in question as suitable for discretionary trading.

Discretion can be a very slippery slope due to the excess of power that it gives to securities brokers. Securities brokers with discretionary authority over an account can place that customer in investments they are highly unsuited for. They can also trade that customer's account excessively. Both of these acts can cause serous financial harm 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 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 James Michael Kennedy, please contact Oakes & Fosher for a free and private consultation. We work on a contingency basis, which means there are no fees charged unless we collect for you.