Former UBS Broker Settles Unauthorized Trading Claims for $1 Million

Recent regulatory and customer dispute developments involving Patrick Alexander Moriarty (CRD #4764378) have raised concerns about client authorization, supervision and internal compliance controls at major brokerage firms. Moriarty, a former registered broker previously associated with UBS Financial Services Inc. and Citigroup Global Markets, is no longer registered in the securities industry.

The issues arose from a Massachusetts state regulatory action involving customer allegations of unauthorized trading. Those allegations resulted in a seven-figure settlement, and UBS later terminated Moriarty following an internal investigation. Together, these developments highlight how failures involving discretionary authority and account oversight can expose investors to significant risk.

Allegations Involving Trade Authorization and Supervision

Regulatory scrutiny of Moriarty included action by the Massachusetts Securities Division, which placed conditions on his registration based on allegations that he exercised discretionary authority in client accounts without obtaining proper authorization. The regulator also cited the use of unapproved communication methods and issues related to required attestations concerning money movements. The matter was resolved through a consent order that imposed heightened supervision requirements rather than monetary penalties.

Separate from the state regulatory action, a customer alleged that Moriarty engaged in unauthorized trading in municipal securities while he was associated with UBS Financial Services. According to the disclosure, the customer claimed that trades were placed without approval, resulting in losses exceeding $1.1 million. The dispute was resolved through a $1,000,000 settlement in November 2024. While settlements do not constitute admissions of wrongdoing, they often reflect the seriousness of the allegations and the potential exposure involved.

UBS Financial Services subsequently terminated Moriarty’s employment in August 2024. The firm said its internal review found that Moriarty exercised unauthorized discretion, made inaccurate attestations regarding money movements and was not forthcoming during the investigation. Terminations for cause based on authorization failures and disclosure issues are commonly viewed as indicators of broader compliance and supervisory concerns.

What Investors Should Understand About Unauthorized Trading

Allegations of unauthorized trading raise fundamental questions about whether transactions were properly approved, explained or understood by the client. When discretion is exercised without clear authorization, investors may be exposed to risks they did not intend to take.

Regulatory actions and heightened supervision requirements often signal broader compliance concerns. These measures are typically imposed when regulators identify weaknesses in how a broker’s activities are monitored or in how firm policies are enforced.

Terminations tied to authorization failures or candor issues can also point to breakdowns in internal controls. Firms rely on accurate disclosures and transparent communication to supervise account activity and safeguard client interests.

For investors, these issues underscore the importance of understanding how trades are authorized, what level of discretion a broker has and how account activity is reviewed. Regularly reviewing account statements, confirmations and authorization agreements can help identify potential problems before losses escalate.

Have Questions About Your Brokerage Account?

The allegations, customer settlement and termination involving Patrick Moriarty underscore the importance of clearly defined trading authority and effective supervision within brokerage accounts. Issues related to unauthorized discretion and internal oversight can expose investors to risks they did not intend to take.

Investors who worked with Moriarty and have questions about how trades were authorized or supervised may consider having their accounts reviewed. Sonn Law Group represents investors nationwide in FINRA arbitration matters involving unauthorized trading and supervision failures. The firm offers confidential case evaluations and works on a contingency-fee basis, meaning there is no cost unless compensation is recovered.

To discuss your situation, call 833-912-3000 or complete the online consultation form.