Articles Posted in Janney Montgomery Scott

Ex-New York Stockbroker Named In Multiple Customer Disputes 

Apostolos Nicolas Pitsironis, a former-Janney Montgomery Scott registered representative who was barred by the Financial Industry Regulatory Authority (FINRA) in 2019 for allegedly defrauding investors, was arrested on February 10 in Dix Hills, New York in a parallel criminal fraud case. Prosecutors contend that he used ex-customers’ funds to pay his expenses, including gambling debts and credit card charges. 

According to the US Attorney’s Office for the Eastern District of New York,  Pitsironis stole $411K out of one couple’s account. If convicted of wire fraud, Pitsironis could spend up to 20 years behind bars.

FINRA Bars Former Morgan Stanley Representative

The Financial Industry Regulatory Authority (FINRA) has barred former Morgan Stanley broker, John Joseph Cahill. The ex-registered representative, who was fired from Janney Montgomery Scott early last year, is accused of potentially converting and/or misappropriating an elderly client’s funds while he was at Morgan Stanley. 

John Cahill Is Accused of Elder Investor Fraud

Janney Montgomery Scott LLC has consented to pay $850,000 to resolve Securities and Exchange Commission charges that it failed to set up and enforce policies to prevent possible insider trading. The financial services firm also agreed to cease from further violations of laws that prevent the misuse of material, nonpublic information that could be used for insider trading. Even with the securities settlement, however, Janney is not admitting wrongdoing.

According to regulators, between January 2005 and July 2009, there were occasions when Janney’s Equity Capital Markets division did not enforce policies. Some of these failures, which created the risk that certain information could be used for insider trading, included:

• Failure to comply with written procedures.
• Not properly monitoring trading in securities belonging to companies that Janney’s investment bankers were advising.
• Not requiring that investment bankers obtain clearance for personal trades prior to making them.
• Failing to get yearly questionnaires identifying employees who had brokerage counts at other financial firms.
• Not reviewing these employees’ activities at these other firms.

Also per the settlement, Janney will retain an independent compliance consultant who will make recommendations about how to comply with laws pertaining to material, nonpublic information.

Insider Trading and Securities Fraud Enforcement Act of 1988
Under this act, firms must implement policies and procedures to prevent insider trading from happening and ensure that employees are aware of these immediately upon hiring. These policies and procedures have to be formal.

It is a firm’s responsibility to ensure that these policies are followed. They must conduct reviews of employees and proprietary trading, while monitoring employee trading that doesn’t involve the firm. If a firm suspects possible insider trading, it must immediately investigate the allegations.

Related Web Resources:

Janney Montgomery Scott To Pay $850K To Settle SEC Charges, RTT News, January 11, 2011
Janney Montgomery Scott settles SEC charges, Bloomberg/Business Week/AP, July 11, 2011
SEC Charges Janney Montgomery Scott Failed to Maintain and Enforce Policies to Prevent Misuse of Material, Nonpublic Information, SEC, July 11, 2011

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“Poohster” Consultant Found Guilty of Insider Trading, Stockbroker Fraud Blog, June 23, 2011
3 Hedge Funds Raided by FBI in Insider Trading Case, Stockbroker Fraud Blog, November 23, 2010
Ex-Goldman Sachs Board Member Accused of Insider Trading with Galleon Group Co-Founder Seeks to Have SEC Administrative Case Against Him Dropped, Institutional Investors Securities Blog, April 19, 2011 Continue Reading ›

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