(FINRA Case #2015045984001)
Mark Kaplan (CRD #1978048, Merrick, New York) – An AWC (Accept, Waiver & Consent) was issued in which Kaplan was barred from association with any FINRA member in all capacities.
Without admitting or denying the findings, Kaplan consented to the sanction and to the entry of findings that he willfully violated Section 10(b) of the Securities Exchange Act of 1934, Securities Exchange Act Rule 10b-5, and violated FINRA Rule 2020, by churning and engaging in unsuitable excessive trading in the brokerage accounts of a senior customer.
The finding stated that Kaplan exercised de facto control over the customer’s accounts and the customer relied on Kaplan to direct investment decisions in his accounts, contacting Kaplan frequently.
In addition, the customer was experiencing a decline in his mental health. The court granted an application by the customer’s nephew to act as his legal guardian and manage his financial affairs after he was diagnosed with dementia.
Kaplan effected more than 3,500 transactions in the customer’s accounts, which resulted in approximately $723,000 in trading losses and generated approximately $735,000 in commissions and markups for Kaplan and his member firm.
Kaplan never discussed with the customer the extent of his total losses or the aggregate amount he paid in sales charges and commissions. High turnover rates and cost-to-equity ratios in the customer’s accounts reflect how difficult it would have been for him to obtain sufficient profits to cover the costs of Kaplan’s active trading. This level of trading was excessive and unsuitable for the customer given his investment profile, including his age, risk tolerance, and income needs.
The firm and Kaplan made a settlement payment totaling $470,000 to the guardian for the customer’s accounts.
Kaplan was employed by Vanderbilt Securities, LLC (CRD# 5953) from March 2011 until February 2018. Prior to that Kaplan was at Morgan Stanley Smith Barney ( CRD# 149777) from June 2009 until April 2011.
If you feel you have been misled or taken advantage by Mark Kaplan 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.