FINRA Contends That Broker Steven Luftschein Made Excessive Trades Causing Investor Losses
Investor Alert! The Financial Industry Regulatory Authority (“FINRA”) brought a regulatory action against Steven R. Luftschein (CRD#: 2690117, Huntington, New York) – also known by the name Steven Lerner. Specifically, in May 2020, the watchdog accused the securities broker of both violating fraud rules and churning accounts. In addition to these serious allegations, no less than 17 investors sued to recover their investment losses, citing Luftschein’s excessive and unauthorized trading and his false statements. Here’s what we know about the problem broker so far.
FINRA’s Complaint Suggests Steven Luftschein Excessively, Unsuitably Traded In Aegis Client Accounts
Apparently, the financial watchdog alleged in a May 2020 Complaint that Steven Luftschein violated FINRA rules and securities laws through a host of sales practice violations worthy of him being barred for. First of all, FINRA pointed out that Luftschein controlled clients’ accounts, making practically all decisions about trading. Luftschein supposedly made unauthorized trades, meaning that clients did not have knowledge of his actions or otherwise consent to them.
Notably, FINRA also accused Steven Luftschein of “deliberately” incurring high costs in those accounts. This made it next to impossible for clients to make a profit from his trades. The securities broker argues in the Complaint that Luftschein directly caused clients $261,000+ in losses. Meanwhile, Luftschein made out just fine because of those commissions that clients paid for his trades. Furthermore, FINRA indicated that Luftschein concealed from customers the costs of his trading.
Moreover, FINRA says that Steven Luftschein made excessive trades. The watchdog considered that Luftschein caused clients high turnover rates and cost-to-equity ratios, making his trading “quantitatively unsuitable.” In addition, FINRA argued that Luftschein did not have a reasonable basis to determine that trades were suitable.
Aegis Client Indicates That Luftschein’s Excessive Trading Produced Losses
Evidently, in January 2020, a client of Aegis sued over Steven Luftschein’s trading. Notably, the client suggested that Luftschein excessively and unsuitably traded certain securities. Not only that, but it seems that Luftschein’s dishonest and misleading tactics kept the client in the dark about his actions. Because of this, the client alleged that Luftschein or Aegis ought to pay $200,000 in compensation. This matter is ongoing.
Steven Luftschein Supposedly Breached Fiduciary Duty, Churned Accounts
Also, a client of Aegis brought a FINRA Arbitration Claim in May 2018 about Steven Luftschein. Namely, the client suggested that Luftschein breached a contract and he breached a fiduciary duty, placing his interests before the client’s interests. Supposedly, he also negligently and unsuitably traded securities in the client’s account. According to the client, Luftschein even churned the account and traded without authorization. Because of this, Aegis made a $132,500 payment to the client to settle the matter in January 2019.
Aegis Settles Client Dispute Centered On Luftschein’s Lousy Investment Recommendations
Notably, a third Aegis client took issue with Steven Luftschein’s trading activities at Aegis. In the February 2018 lawsuit, the client suggested that Luftschein made unreasonable recommendations. It seems that Luftschein lacked the client’s consent for transactions too. For this reason, the securities firm opted to resolve this matter through making a $569,962.38 payment to the client in May 2019.
Losses From Aegis Broker Steven Luftschein?
Have you experienced losses by investing with Aegis securities broker Steven Luftschein? If you have, contact Soreide Law Group at (888) 760-6552 and speak with experienced counsel concerning a potential recovery of your investment losses. Soreide Law Group provides representation to clients on a contingency fee basis and advances costs. The law firm has recovered millions of dollars for clients who have experienced losses due to misconduct of securities brokers like Luftschein.