The regulator claims that Zachary S. Berkey and Daniel T. Fischer, while working at broker/dealer Four Points Capital Partners, used an in-and-out trading strategy that was unsuitable for customers, but generated big commissions for themselves. They’re no longer registered. The brokers received about $106,000 and $175,000, respectively, in commissions, while 10 customers lost a total of $573,867.
The latest case is part of a larger effort by the SEC to crack down on unscrupulous brokers. The SEC brought similar charges of excessive trading against brokers in January, April and September.
“We’re intensifying our focus on unscrupulous brokers and their harmful practices,” said Sanjay Wadhwa, senior associate director of the SEC’s New York regional office. “As alleged in our complaint, Berkey and Fischer did grave harm to their customers by providing unsuitable recommendations and siphoning money in the form of high commissions and costs.”
Fischer consented to a final judgement without admitting or denying the SEC’s allegations. He is permanently prohibited from similar violations. The judgement also orders him to return the gains along with a $160,000 penalty. He also agreed to an SEC order barring him from the securities industry and penny stock trading.
The SEC’s litigation against Berkey is ongoing.
Source: Wealth Management