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Articles Tagged with Aegis Capital

Former National Securities Stockbroker Named in Over 12 Customer Disputes

Thomas Edison Kelly, Jr., an Aegis Capital broker, has been the subject of a number of customer complaints between 2013 and 2020, three of which are still pending. 

Prior to working for Aegis Capital in 2018, Kelly was a National Securities broker for 10 years. Before that, he was with First Republic Group from 1998 to 2008. First Republic was expelled by the Financial Industry Regulatory Authority (FINRA) in 2019. According to a 2017 Reuters report analyzing FINRA data, National Securities is one of 48 firms that hire brokers with red flags on their record.

The Financial Industry Regulatory (FINRA) announced that it is barring former Aegis Capital broker James Schwartz for allegedly churning four clients’ accounts. The self-regulatory authority (SRO) contends that Schwartz, who is no longer employed in the securities industry, made 256 trades in these accounts without first getting the customers’ permission to execute the transactions. Along with other trades he made in these accounts—535 trades in total—the customers ended up collectively losing over $660K.

FINRA’s BrokerCheck record on its case against Schwartz said that he engaged in about $10M worth of unauthorized trades. Some trades were also allegedly excessive.

The SRO said that Schwartz earned commissions and gross sales credits of $277,705 from these fraudulent transactions, more than $194,000 of which was paid to the former Aegis Capital broker.

The US Securities and Exchange Commission, the Financial Industry Regulatory Authority, and the US Treasury Department’s Financial Crimes Enforcement Network are investigating brokerage firm Aegis Capital Corp. The reason for the probe has not been disclosed.

In Aegis Capital’s latest audited financial statement, the firm said that it has responded to the joint inquiry. A lawyer for the broker-dealer said that it would not comment further. The attorney, however, did note that regulators have yet to file a complaint and that Aegis Capital is not in litigation at the moment with any of these agencies.

According to Aegis Capital’s BrokerCheck profile, the firm has 27 previous disclosures, including one in 2015 that the broker-dealer settled with FINRA, agreeing to pay $950K over the allegedly improper sales of billions of unregistered penny stock shares and purported lapses in anti-money-laundering supervision. Two ex-Aegis Capital chief compliance officers were suspended and ordered to pay related fines.

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