Scott Hananel In Client Suitability Disputes

The Financial Industry Regulatory Authority (FINRA) important information relating to securities broker Scott Neil Hananel [CRD #: 3080827, Melville, NY]. Hananel worked for (1) Aegis Capital Corp from 2010-2021; (2) GunnAllen Financial Inc. from 2005-2010; and (3) Milestone Group Management from 2002-2005.

Evidently, Aegis Capital Corp. investors disputed the sales practices of the securities broker. Additionally, Hananel discloses a regulatory action resulting in sanctions against him for purported unsuitable recommendations. However, Hananel denies the allegations of sales practice violations. Read on to learn more about the allegations against Hananel.

Aegis Capital Corp. Client Accuses Scott Hananel Of Unsuitable Transactions

Also, an Aegis Capital Corp. client filed FINRA Arbitration #: 21-00273 about Scott Hananel. Specifically, the client alleged that Hananel made unsuitable transactions. Because of this, the client purportedly sustained damages. Therefore, on May 26, 2022, Aegis Capital Corp. settled this matter by paying the client $242,500.

FINRA Sanctions Hananel For Unsuitable Recommendations

Specifically, FINRA says that between July 2014 and December 2018, Hananel unsuitably and excessively traded in the accounts of six clients while he was associated with Aegis Capital Corp. Hananel also exercised discretion without getting prior written approval from the clients or Aegis Capital Corp. in six client accounts with respect to 571 trades.

Specifically, Hananel decided which stocks to trade and when he would trade them. To FINRA, Hananel exercised “de facto control” over the accounts of the six clients. From July 2014 through December 2018, Hananel's trades caused the clients to suffer significant losses. Still, they paid significant commissions, markups, and trading costs. In one instance, a married senior couple suffered losses in the amount of $44,641 and paid commissions and trading costs of $109,084. Supposedly, the couple’s account had an annualized cost-to-equity ratio of 55.61 and an annualized turnover rate of 21.98 as a result of Hananel's trading.

Another senior citizen client suffered losses in the amount of $332,002 and paid commissions and trading costs of $110,066. Supposedly, their account had an annualized cost-to-equity ratio of 28.91 and an annualized turnover rate of 21.92. Notably, Hananel allegedly did not obtain prior written approval from the clients of the firm to make discretionary trades which was required by Aegis's supervisory procedures. As a result, Hananel violated FINRA Rules 2010, 2111, and NASD Rule 2510(b).

Aegis Capital Corp. Client Accuses Scott Hananel Of Breach Of Fiduciary Duty

Evidently, an Aegis Capital Corp. client filed FINRA Arbitration #: 21-00235 about Scott Hananel. Specifically, the client alleged that Hananel breached a fiduciary duty, breached a contract, and made unsuitable recommendations. For this reason, the client purportedly sustained damages relating to investments in stocks. Therefore, on May 2, 2022, Aegis Capital Corp. settled this matter by paying the client $2,100,000.

Hananel Allegedly Makes Unauthorized Transactions In Account Of Aegis Capital Corp. Client

Also, a client of Aegis Capital Corp. contested Scott Hananel’s sales practices by filing FINRA Arbitration #: 20-03965 on December 7, 2020. Supposedly, Hananel made unauthorized and unsuitable transactions and churned the client's account. Allegedly, Hananel had caused the client to sustain damages. Therefore, the client seeks compensatory relief from Aegis Capital Corp. or Hananel in the amount of $50,000 in this ongoing matter.

Damages Resulting From Aegis Capital Corp. Securities Broker Scott Hananel?

Did you sustain damages through any sales practice violations by Scott Hananel? If so, contact Soreide Law Group at (888) 760-6552 and speak with a securities attorney about a potential recovery of your investment damages. Soreide Law Group, who has successfully recovered money for investors throughout all 50 states, represents clients on a contingency fee basis and advances all costs. Hananel and brokerage firms Hananel associated with deny any and all allegations of sales practice violations.