FINRA Complaint Filed Against Spartan Capital Securities

In a complaint dated December 15, 2025, the Financial Industry Regulatory Authority (FINRA) alleges Spartan Capital Securities, LLC, and five individuals, for more than four years, “defrauded customers by engaging in widespread churning, generating millions in revenue and causing customers millions in harm. Spartan’s business model depended on this misconduct – approximately two thirds of the firm’s trading revenue and one-third of its overall revenue, more than $46 million in total, was generated from more than 1,200 accounts with a cost-to-equity ratio greater than 20% from January 2018 to April 2022.”

The FINRA complaint focuses primarily on 114 customer accounts that incurred nearly $10 million in total trading costs and suffered nearly $8 million in investment losses because of excessive trading, 53 of the 114 excessively traded accounts were senior customers. FINRA alleges 35 of those customer accounts were churned including 20 belonging to senior customers. The alleged violations occurred between January 2018 and April 2022. FINRA alleges that the firm facilitated this churning and excessive trading, failing to take any meaningful steps to supervise the 39 registered representatives who carried out this misconduct allegedly on the firm’s behalf.

In an article from AdvisorHub, they state that according to FINRA, the trading activity allegedly produced cost-to-equity ratios as high as 491%. The article states that allegedly one-third of Spartan Capital Securities’ revenue was generated from accounts with cost-to-equity ratios higher than 20%, indicating excessive trading, according to FINRA. 

The FINRA complaint also names five brokers and executives from Spartan Capital Securities, LLC:

Kim M Monchik,

Frederick Joseph Cammarano III,

James Pecoraro,

John Stapleton

and Michael Darvish. 

According to FINRA there were allegedly an additional 36 Spartan Capital Securities registered representatives, not named as respondents, but failed to “take any meaningful steps to supervise” or prevent the churning.

According to the FINRA complaint, Spartan allegedly allowed the Spartan Representatives to churn and excessively trade customer accounts despite glaring red flags that those representatives were allegedly committing misconduct and harming customers. During the relevant period, Spartan, Respondent Kim Monchik, the firm’s Chief Administrative Officer and periodic Chief Compliance Officer and Frederick Joseph Cammarano III, the firm’s Regional Branch Manager and direct supervisor of many of the Spartan Representatives, allegedly ignored numerous red flags of excessive trading and churning in hundreds of Spartan customer accounts.

According to the AdvisorHub article Kim M Monchik has served as Spartan Capital Securities’ chief administrative officer since 2015 and she also served as chief compliance officer and was allegedly responsible for the firm’s trading from January 2018 until February 1, 2019, according to the FINRA complaint. Frederick Joseph Cammarano III was the branch manager for Spartan’s New York City office and supervised many of the brokers, according to the complaint. James Pecoraro has 26 years of experience and joined Spartan in 2019, according to BrokerCheck. John Stapleton has nearly 30 years of experience and joined Spartan in 2015. Michael Darvish joined Spartan in 2017 and was a principal and senior private wealth manager at Spartan. 

According to the FINRA complaint, FINRA alleges that by churning customer accounts, Spartan, Pecoraro, and Stapleton willfully violated the Securities Exchange Act of 1934 and violated FINRA Rules 2020 and 2010. By excessively trading customer accounts, Spartan and the Respondent Representatives violated Reg BI, and Spartan, Pecoraro, and Darvish violated FINRA Rule 2111 relating to suitability.

If you invested with Spartan Capital Securities and suffered financial losses, contact Soreide Law Group and speak to an experienced securities lawyer at no cost:  888-760-6552.

Soreide Law Group represents our clients nationwide before FINRA on a contingency fee basis.