Stu Pearl Allegedly Made Unauthorized Trades

David A. Noyes' Stu Pearl Allegedly Made Unauthorized Margin Transactions

The Financial Industry Regulatory Authority (“FINRA”) reports troubling information in regard to securities broker Stuart “Stu” Pearl (CRD#: 1500833, Indianapolis, Indiana). Namely, no less than 5 clients came forward with disputes about Pearl’s sales practices. Not only that, but FINRA’s suspension and fine against Pearl for allegedly trading on a discretionary basis, coupled with Pearl’s termination from two securities firms for wrongdoing, indicates that the broker is responsible for causing investors’ losses.

David A. Noyes Client Indicates That Stu Pearl Had No Authorization To Use Margin

The BrokerCheck Report for Stu Pearl  a client dispute from May 18, 2020 that concerned Pearl’s sales practices. Namely, the client indicated that Pearl set up a margin trading account without the client’s consent. Supposedly, Pearl did not even discuss this margin trading account with the client. Allegedly, Pearl caused the client to experience investment losses. For this reason, the client demanded $2,088,124 in compensation in this ongoing matter.

Pearl Purportedly Puts On Hedge Position Without David A. Noyes’ Client’s Knowledge

It appears that a second David A. Noyes client came forward in a dispute about Stu Pearl. In this March 10, 2019 complaint, the client suggested that without telling the client, Pearl set up a hedge position in connection with ETF trades. It seems that Pearl caused the client’s equity losses. Because of this, on July 1, 2019, David A. Noyes agreed to pay the client $42,500 to settle the unauthorized trading dispute.

Stu Pearl Suspended, Fined To Resolve FINRA Allegations Of Pearl’s Discretionary Trading Without Authorization

In addition, FINRA issued sanctions to Stu Pearl on October 9, 2017 for wrongfully making discretionary securities transactions in an Ameriprise client’s investment account. Specifically, the client and Ameriprise did not give Pearl written authorization for discretionary trading. Not only that, but FINRA said that Pearl made unsuitable recommendations to other Ameriprise clients. Supposedly, Pearl convinced clients to use margin in order to trade securities. But trading on margin was seemingly wrong because of clients’ risk tolerances, investment objectives and financial situations. Because of this, FINRA says, clients had high margin debt balances and margin calls. Apparently, Pearl served his suspension in 2017 and paid a $7,500 fine.

Prior Disputes Indicate Pearl Made Unauthorized Trades

Notably, a client’s investment dispute from 2013 suggests that Stu Pearl essentially controlled the client’s account and “heavily margined her accounts and recommended unsuitable investments.” Evidently, Ameriprise opted to settle the matter by making a $95,500 payment to the client. Also, Merrill Lynch and Salomon Smithy Barney paid a client more than $400,000 in combined compensation after the client alleged breach of fiduciary duty, negligence and violation of NYSE and NASD rules.

Losses From Broker Stu Pearl?

Have you experienced losses by investing with Stu Pearl? If so, reach out to Soreide Law Group at (888) 760-6552 and speak with experienced counsel concerning a possible recovery of your investment losses. Soreide Law Group represents clients on a contingency fee basis and advances all costs. The law firm has recovered millions of dollars for clients who have incurred losses due to misconduct of securities firms and brokers like Pearl.