The law firm of Oakes & Fosher is presently investigating the possible misconduct of former securities broker Joshua Stamm. According to his publicly available FINRA BrokerCheck report, Joshua Stamm has been the subject of multiple sanctions.
Joshua Stamm was a Virginia based securities broker. He worked in the securities industry for thirteen years. During his career, he was registered with three different securities firms. He is no longer working as a registered securities broker in any fashion.
His Registrations
- Edward Jones (2002-2004)
- UBS Financial Services (2004-2008)
- Merrill Lynch (2008-2016)
The Allegations
- Joshua Stamm was discharged from Merrill Lynch in June 2016. This was due to allegations that he took part in assisting a client in making credit arrangements outside the firm and sending written correspondence without management review.
- In January 2017, Joshua Stamm was sanctioned by the Virginia State Corporation Commission. This was due to allegations that he did not get approval from his member firm before he took part in a particular securities activity. He also did not record the specific activity in any of the books or records at the firm. Due to the allegations, he was fined $12,000.
- In May 2018, Joshua Stamm was sanctioned by FINRA. The findings in this matter state that Joshua Stamm participated in two undisclosed private securities transactions in which one of the firm’s customers purchased $500,000 worth of promissory notes. Stamm gave no notice and received no approval before partaking in this private transaction. Due to these allegations, he was fined $5,000 and suspended for a period of six months.
What Does This Mean?
Securities brokers are not allowed to engage in private securities transactions without first obtaining their member firm’s authorization to do so. This is because privately traded alternative investments do not trade on any public securities exchanges and are often very poorly regulated. This means there is a great potential for oversight when dealing with these types of products.
There are often significant conflicts of interests that occur as well. Sometimes securities brokers can have a financial stake in the private security they are recommending. Sometimes they may be receiving cash kickbacks from a third party to recommend the security. However, most of the time it boils down to the excessively high commissions securities brokers receive when recommending privately traded securities.
It is the responsibility of the securities firm to prevent member firm customers from being harmed by a securities broker’s conflict of interest. The fact that a securities broker does not disclose their involvement in these outside transactions does not absolve the firm from liability. This is because it is the securities firm’s responsibility to adequately supervise all of its registered brokers and prevent them from engaging in any unauthorized activity.
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 Joshua Stamm, 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.
