Meyers Associates Broker Emil Botvinnik Charged With Fraud

Emil Botvinnik (CRD#: 4359481, New York, New York) is a previous registered representative of Meyers Associates, L.P. who was employed from June 19, 2012 to November 17, 2014. The Securities and Exchange Commission (“SEC”) filed a Complaint against Botvinnik alleging that he committed securities fraud. United States Securities and Exchange Commission vs. Emil Botvinnik, Case #: 1:18-cv-08182 (Filed September 7, 2018).

SEC Alleges Meyers Broker Emil Botvinnik Defrauded Investors

The SEC’s Complaint stated that between June 2012 and November 2014, while Botvinnik was registered with Meyers Associates, he committed securities fraud by excessively trading in customer’s accounts. The SEC alleged that Botvinnik defrauded retail customers because Botvinnik’s trading allowed him to generate a significant amount of commissions while customers were left with substantial losses.
Apparently, Botvinnik steered five Meyers Associates LP customers to establish trading accounts, assuring them that Botvinnik’s trading strategy would be profitable for them. Botvinnik apparently advised the customers to invest based on a short-term trading strategy. Allegedly, customers paid substantial commissions each time a trade was effected in their accounts.
As a result of Botvinnik’s apparent excessive trading and charging of lofty commissions, the SEC contended it was practically certain that customers would incur investment losses. The investments selected for the customers seemingly needed to generate annual returns ranging between 31 percent and 150 percent to cover the costs pertaining to Botvinnik’s investment recommendations.
SEC alleged that Botvinnik needed to have a reasonable basis to believe that his recommended trading was appropriate for customer. The Complaint alleged that Botvinnik failed to have a reasonable basis in believing that his trading strategy was suitable for any investor because of the volume of trading that he recommended and the costs pertaining to the transactions.
The Complaint further stated that Botvinnik acted deceptively and fraudulently by trading in the Meyers Associates customers’ non-discretionary accounts. Specifically, the Complaint stated that Botvinnik did not gain the customers’ permission before trades were placed in their accounts. Additionally, Botvinnik allegedly failed to apprise those customers about important facts regarding his recommended trading strategy.
Customers reportedly incurred losses of $2,700,000.00 as a result of Botvinnik’s fraudulent conduct even though Botvinnik accumulated illicit gains totaling $3,700,000.00. SEC claimed that Botvinnik’s conduct violated Section 10(b) of the Securities Exchange Act of 1934, Rule 10b-5 and Section 17(a) of the Securities Act of 1933.
FINRA BrokerCheck disclosed that at least six other customers of Botvinnik have filed disputes alleging sales practice violations including churning and suitability. Here is a summary of some of those disputes:
1) A Liberty Partners Financial Services, LLC customer filed a complaint on September 17, 2008. The customer alleged that trading was not suitable given the customer’s risk tolerance. In addition, the customer alleged that trades were unauthorized and excessive. Liberty Partners Financial Services, LLC agreed to pay the customer $70,000.00 in damages on September 17, 2009 to resolve those claims.
2) A customer of First Midwest Securities brought a complaint on June 24, 2010. The customer alleged that Botvinnik engaged in unauthorized trading in the customer’s account. As a result, the customer demanded $55,000.00 in damages. The complaint was not pursued as of July 6, 2010.
3) A Meyers Associates LP customer alleged in a September 30, 2014 complaint that Botvinnik charged the customer excessive commissions on equity trades. According to the customer, Botvinnik failed to commit to a designated commissions schedule. Ultimately, the customer’s complaint was settled for $385,000.00 in damages on September 30, 2014.
4) A customer of Meyers Associates LP filed an arbitration claim on April 29, 2016. According to the customer, Botvinnik made unsuitable equity trades and churned the customer’s account. On January 8, 2018, the customer agreed to be paid $48,000.00 in damages to settle the matter. (FINRA Arbitration Case #16-01051).
5) A Salomon Whitney LLC customer filed an arbitration on November 16, 2016 concerning Botvinnik’s purportedly unsuitable and excessive trades. The customer alleged that the account was inappropriately leveraged and that there were insufficient steps taken to reduce risk. Salomon Whitney agreed to resolve the customer’s claim on February 15, 2017 for $30,000.00. (FINRA Arbitration Case #16-03284).
Botvinnik has been employed by Newport Coast Securities, Inc. between November 5, 2014 and November 17, 2015. He worked for SW Financial from November 17, 2015 to October 23, 2017. Subsequently, he was employed by Worden Capital Management from October 24, 2017 to February 8, 2018.

Have you experienced losses from Emil Botvinnik or other registered representatives based on churning, unsuitability or other sales practice violations? If so, contact Soreide Law Group at (888) 760-6552 and speak with an experienced attorney about the possibility of recovering your investment losses. Soreide Law Group represents clients nationwide and only charges a fee upon recovery of investment losses.