Former stock broker Michael Thomas McKenna (CRD#: 4124902), who was registered with the firm Chelsea Financial Services (CRD#: 47770) in East Meadow, New York, is involved in a customer dispute relating to allegations that he engaged in excessive and unsuitable trading. The customer is seeking damages in the amount of $98,127.00.
Stock brokers have a duty to recommend suitable investments and investment strategies to their clients. A recommendation is only suitable if it comports with the client’s investment objectives, risk tolerance, investment experience, investment time horizon, liquidity needs, and income needs. The duty to recommend suitable investments cannot be disclaimed through risk disclosures or waivers.
Excessive trading or “churning” occurs when the primary purpose of a broker’s trading activity in a customer’s account is to generate commissions for the broker. Churning is specifically prohibited under securities laws and regulations, including FINRA’s “quantitative suitability” standard. The FINRA standard provides that a broker must “have a reasonable basis for believing that a series of recommended transactions . . . . are not excessive and unsuitable for the customer . . .”
If you are a former customer of Mr. McKenna and Chelsea Financial Services, and you have suffered investment losses, the law firm Mika Meyers, PLC may be able to help you. We regularly evaluate and prosecute claims on behalf of investors who have suffered investment losses as a result of unsuitable investment recommendations. If you wish to discuss your claim with an experienced attorney who specializes in this area, call Daniel J. Broxup at (616) 632 8059.