The law firm of Oakes & Fosher is presently investigating the alleged misconduct of former securities broker Joseph Pratt. According to his publicly available FINRA BrokerCheck report, Joseph Pratt has been the subject of a FINRA sanction.

Joseph Pratt was a Pennsylvania based securities broker. He worked in the securities industry for thirty-eight years. During his career, he was registered with five different securities firms. He is no longer working as a registered securities broker in any fashion.

His Registrations

  • W.H. Newbold’s Son & Co. (1980-1991)
  • Fahnestock & Co. (1992-2000)
  • A.G. Edwards (2000-2008)
  • Wells Fargo (2008-2014)
  • Stifel, Nicolaus & Company (2014-2019)

The Allegations

Joseph Pratt was officially sanctioned by FINRA in September 2019. The findings in this matter state that Pratt solicited customers of his member firm to invest a total of $436,000 in a privately traded company that he had a personal stake in. He allegedly failed to obtain his member firm’s authorization before committing these acts. Due to these alleged actions, he was terminated from Stifel, Nicolaus & Company and barred by FINRA from acting as a securities broker in any fashion.

What Does This Mean?

Securities brokers are not allowed to recommend private securities to their member firm customers without authorization from their member firm. This is because these types of investments can often create significant conflicts of interest for securities brokers that skew their motivations. Less than scrupulous securities brokers might simply recommend securities because they are receiving cash incentives from a third party, because of the incredibly high commissions they receive when the transaction is executed, or, as with the allegations against Joseph Pratt, because they themselves have a financial stake in the security they are recommending. These conflicts of interest can often cause brokers to recommend these private investments to member firm customers that are not financially suited for them in any way. This is why securities firms require all of their registered brokers to disclose their intent if they plan on recommending these investments prior to engagement. This gives securities firms the opportunity to analyze the situation and determine if a conflict of interest exists, or if any investor might be harmed by the broker’s recommendations. However, the securities firm is not absolved from liability simply because the securities broker forgoes the process of disclosing their intent to engage in these private transactions. Securities firms need to have adequate procedures in place designed to supervise its registered brokers and prevent them from engaging in any unauthorized, and potentially harmful, activities.

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 Joseph Pratt, 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.