(FINRA Case #2014043043601)
Marlon O. Cole (CRD #5054806, Queens Village, New York)– An AWC (Accept, Waiver, Consent) was issued in which Cole was assessed a deferred fine of $5,000 and suspended from association with any FINRA member in all capacities for 16 months.
Without admitting or denying the findings, Cole consented to the sanctions and to the entry of findings that he engaged in excessive trading in senior citizens’ accounts.
The findings stated that Cole controlled the accounts and his trading generated high costs and turnover rates that were inconsistent with the customers’ objectives, yet generated steady sales charges for Cole. The sales charges were in the form of both commissions and mark-ups and mark-downs. The sales charges were set forth on trade conformations to the customers. Commissions were clearly stated; however, mark-ups and mark-downs, which accounted for many of the sales charges, were not clearly stated. Thus, the customers would need to understand that they must calculate the aggregate cost for the trade.
The findings also stated that Cole engaged in qualitatively unsuitable trading in two accounts by recommending transactions solely to generate sales charges. Cole engaged in a strategy in one customer’s account of purchasing a security, selling a covered call option on that security, and then buying back the call position at a loss and selling the underlying stock at a loss. Cole executed more than 30 of these trades, which resulted in more than $30,000 in losses to the customer, while generating $26,000 in sales charges for Cole. Cole recommended a similar strategy in another customer’s account, which also resulted in losses. This covered call strategy had no economic benefit for the customers and was recommended solely to generate sales charges.
The findings also included that Cole engaged in unauthorized transactions in two accounts. In one instance, a customer authorized the purchase of 500 shares of a stock, but Cole purchased 2,000 shares. The transaction generated a sales charge of $2,980 for Cole. In another instance, Cole executed 12 transactions in a customer’s account without authorization that resulted in losses of more than $12,000 to the customer, but generated sales charges of more than $8,000 for Cole.
The suspension is in effect from October 16, 2017, through February 15, 2019.
Cole has worked for 11 different brokerage firms since 2006, five of which have been expelled by FINRA
If you feel you have been misled or taken advantage by Marlon O. Cole or any Broker and wish to discuss legal action, please contact Darren Blum at 1-877-786-2552 (1-877-STOCK LAW), www.stockattorneys.com for a free consultation.
Blum Law Group is a law firm with a worldwide practice representing individuals and institutions in disputes with Wall Street and the financial services industry.