Joseph Albert Ambrosole, Formerly of Joseph Stone Capital, Barred by FINRA After Allegations of Unsuitable Trading

INVESTORS: Former Joseph Stone Capital broker Joseph Albert Ambrosole was barred by FINRA after he refused to appear for testimony in connection with their investigation into allegations of unsuitable trading.

Joseph Albert Ambrosole (CRD: 5732488) was registered as a broker with Joseph Stone Capital from 207 until 2021. Ambrosole was previously registered as a broker with Alexander Capital in 2017.

Ambrosole has ten disclosures on his BrokerCheck report. 

July 2022  Regulatory Judgment

Status: Final

Initiated By: FINRA

Allegations: Without admitting or denying the findings, Ambrosole consented to the sanction and to the entry of findings that he refused to appear for on-the-record testimony requested by FINRA in connection with its investigation concerning an amended Uniform Termination Notice for Securities Industry Registration (Form U5) filed by his member firm disclosing a customer complaint alleging that Ambrosole engaged in unsuitable trading.

Resolution: Acceptance, Waiver & Consent (AWC)

Bar: Bar (Permanent)

Registration Capacities Affected: All Capacities

Duration: Indefinite

Start Date: 7/28/2022

July 2021 Customer Dispute

Status: Pending

Allegations: Allegations in attorney letter stating “unsuitable trading”. Dates: From February 2021 until May 2021.

Damage Amount Requested: $853,231.33

June 2021 Regulatory Judgment

Status: Pending

Initiated By: State of Maryland, Office of the Attorney General, Securities Division

Allegations: On June 17, 2021, the Maryland Securities Commissioner filed an Order to Show Cause directing the broker to show cause why an order should not issue preventing the broker from engaging in the activities of an agent in the state. The Maryland Securities Commissioner also issued an order of summary suspension while to the proceeding is pending. The basis for the State action are prior regulatory disclosures unrelated to any activities in the state of Maryland.

April 2021 Regulatory Judgment

Status: Final

Initiated By: FINRA

Allegations: Without admitting or denying the findings, Ambrosole consented to the sanctions and to the entry of findings that he excessively and unsuitably traded the accounts of two customers. The findings stated that the first account belonged to an elderly customer who began to sustain permanent, progressive, neurological and cognitive impairments. This customer’s account had an average monthly equity of approximately $300,000 and Ambrosole recommended and executed 157 trades, which caused the customer to pay more than $126,000 in commissions and other trading costs. Ambrosole’s recommended trades resulted in an annualized cost-to-equity ratio of approximately 20 percent, which means the customer’s account would have had to grow by more than 20 precent annually just to break even. The second account belonged jointly with the first and had an average monthly equity of approximately $70,000. Ambrosole recommended and executed 40 trades in this account which caused the customers to pay more than $20,400 in commissions and other trading costs. Ambrosole’s recommended trades resulted in an annualized cost-to-equity ratio of approximately 35 percent in the joint account. The customers relied on Ambrosole’s advice and accepted his recommendations. Collectively, Ambrosole’s recommendations caused the customers to pay $147,031.50 in commissions and other trading costs.

Resolution: Acceptance, Waiver & Consent (AWC)

Sanctions: Civil and Administrative Penalty(ies)/Fine(s)

Amount: $5,000.00

Sanctions: Restitution

Amount: $147,031.50

Sanctions: Suspension

Registration Capacities Affected: All Capacities

Duration: Six Months

Start Date: 5/3/2021

End Date: 11/2/2021

Sanctions: Ambrosole and/or a registered principal of his firm shall, within 30 days, certify to FINRA that restitution has been paid pursuant to the consent order with the New Hampshire Securities Division in an amount not less than $147,031.50.

March 2021 Regulatory Judgment

Status: Final

Initiated By: New Hampshire Bureau of Securities Regulation 

Allegations: Ambrosole engaged in heavy unsuitable trading which resulted in high commissions for himself and losses to his elderly and ill client of at least $175,000

Resolution: Consent

Sanctions: Cease and Desist

Sanctions: Civil and Administrative Penalty(ies)/Fine(s)

Amount: $130,000.00

Sanctions: Restitution

Amount: $175,000.00

August 2018 Customer Dispute

Status: Settled

Allegations: Common law fraud, breach of fiduciary duty, negligence (gross negligence), breach of contract.

Damage Amount Requested: $100,000.00

Settlement Amount: $10,000.00

March 2018 Customer Dispute

Status: Settled

Allegations: Churning, unsuitability, overconcentration

Damage Amount Requested: $275,000.00

Settlement Amount: $54,900.00

February 2017 Judgment / Lien

Judgment / Lien Amount: $57,199.00

Judgment / Lien Type: Tax

Broker Comment: Lien for tax year 2014- Broker was traveling outside of the U.S. for 15 months and only learned of his outstanding tax bill when he returned home. Presently working with the IRS on a payment plan. As of 07/24/2017, the broker has established an installment agreement with the Internal Revenue Service (“IRS”) in order to pay off the tax debt.

February 2017 Regulatory Judgment

Status: Final

Initiated By: FINRA

Allegations: Without admitting or denying the findings, Ambrosole consented to the sanctions and to the entry of findings that he executed five unauthorized trades in the account of a customer. The findings stated that Ambrosole sold four securities owned by the customer and used the proceeds from those sales to purchase a UIT on behalf of the customer, all without the customer’s authorization. Ambrosole’s unauthorized trading resulted in $645.97 in losses in the customer’s account.

Resolution: Acceptance, Waiver & Consent (AWC)

Sanctions: Civil and Administrative Penalty(ies)/Fine(s)

Amount: $5,000.00

Sanctions: Restitution

Amount: $645.97

Sanctions: Suspension

Registration Capacities Affected: Any Capacity

Duration: One Month

Start Date: 2/21/2017

End Date: 3/20/2017

August 2016 Regulatory Judgment

Status: Final

Initiated By: FINRA

Allegations: Respondent Ambrosole failed to respond to FINRA request for information.

Resolution: Letter

Sanctions: Suspension

Registration Capacities Affected: Any Capacity

Duration: N/A

Start Date: 9/9/2016

End Date: 11/9/2016

Regulator Statement: Pursuant to FINRA Rule 9552 and in accordance with FINRA’s Notice of Suspension letter dated August 16, 2016, Ambrosole is suspended on September 9, 2016 from associating with any FINRA member firm in any capacity. If Ambrosole fails to request termination of the suspension within three months of the date of the Notice of Suspension, he will automatically be barred on November 21, 2016 from association with any FINRA member in any capacity pursuant to FINRA Rule 9552(h). Suspension lifted on November 9, 2016.

Broker Comment: Pursuant to FINRA Rules 9552 Ambrosole is suspended on September 2, 2016 from associating with any FINRA member firm in any capacity. If Ambrosole fails to request termination of the suspension with three months of the date of the notice of suspension, he will automatically be barred on November 21, 2016, from association with any FINRA member in any capacity pursuant to FINRA Rule 9552(H) suspension lifted on November 9, 2016.

The Sonn Law Group is currently investigating allegations surrounding Joseph Albert Ambrosole. We represent investors in claims against negligent brokers and brokerage firms. If you or your loved one experienced investment losses, we are here to help. For a free consultation, please call us now at 866-827-3202 or complete our contact form.