The law firm of Oakes & Fosher is currently investigating the alleged misconduct of securities broker Sylvester Knox. According to his publicly available FINRA BrokerCheck report, Sylvester Knox was the subject of multiple customer disputes over the course of his career.

Sylvester Knox was a New Jersey-based securities broker who worked in the securities industry for twenty-nine years. During his career, he was registered with eight different securities firms.

His Registrations 

  • Painewebber Incorporated (1989-1990)
  • Madison Chapin Associates (1990-1990)
  • Metropolitan Life Insurance Company (1990-1994)
  • Metlife Securities (1990-1994)
  • Marketing One Securities (1994-1996)
  • First Union Brokerage Services (1996-2000)
  • Merrill Lynch, Pierce, Fenner & Smith (2000-2017)
  • FSC Securities Corporation (2017-2018)

The Allegations 

  • In September 2013, a customer alleged that Sylvester Knox had failed to follow instructions, recommended unsuitable investments, and made material misrepresentations and omitted facts regarding an investment. This case was settled for $53,000 in damages.
  • In May 2016, customers alleged that Knox recommended unsuitable investments and made material misrepresentations regarding said investments. This case was settled for $155,000 in damages.
  • In July 2016, customers alleged that Knox executed unauthorized and unsuitable investments and material misrepresentations regarding investments. This case was settled for $140,000 in damages.
  • In August 2016, a customer alleged that Knox had made material misrepresentations regarding investments. This case was settled for $76,961 in damages.
  • In August 2016, a customer alleged that Knox had executed unauthorized trades and made material misrepresentations of facts regarding investments. This case was settled for $95,899 in damages.
  • In October 2016, a customer alleged that Knox had executed unauthorized trades and made material misrepresentations of facts regarding investments. This case was settled for $67,607 in damages.
  • In October 2016, nine separate customers alleged that Knox had executed unauthorized trades and made material misrepresentations of facts regarding investments. These cases were settled for varying amounts in damages, ranging from $66,000 to $146,000.
  • In November 2016, a customer alleged that Knox had recommended unsuitable investments and made material misrepresentations of and omitted facts regarding investments. This case was settled for $1,569,114 in damages.
  • In May 2017, a customer alleged that that Knox had made material misrepresentations of and omitted facts regarding investments. This case was settled for $300,000 in damages.
  • In August 2020, FINRA officially sanctioned Knox for allegedly exercised discretionary trading authority and effected transactions with a total principal value of approximately $2 million in the accounts of firm customers without having obtained prior written authorization from the customers or approval from the firm to treat the accounts as discretionary. As a result of these findings Knox was suspended from acting as a securities broker in all capacities for a period of nine months and fined a total of $10,000.

What Does This Mean?

Securities brokers are prohibited from executing trades on behalf of investors without first obtaining the investor’s authorization.  There is however a practice known as discretionary trading that allows a securities broker to execute trades in a client’s account without obtaining authorization for each one, but the broker must first obtain written authorization from the investor first.  This written authorization is necessary as it keeps the investor involved in the process and helps protect them against potential unsuitable investments made without their knowledge.

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 due to this fraud or negligence 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 Sylvester Knox, 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.