Summit Brokerage Services Fined, Ordered to Pay Restitution for Broker ‘Churning’

Excessive Trading By a Financial Advisor Cost Summit Brokerage Investors More Than $300,000

The Sonn Law Group is investigating allegations that Summit Brokerage Services failed to properly supervise a financial advisor who ‘churned’ at least fourteen customer accounts. If you suffered losses working with Summit Brokerage, we want to discuss your case. Please call 866–827–3202 or contact our law firm right away for a free consultation.

Summit Brokerage Services (CRD#: 34643/SEC#: 8–46310) is a licensed broker-dealer based in Boca Raton, Florida. On July 2nd, 2019, Summit Brokerage reached a settlement with the Financial Industry Regulatory Authority (FINRA) over allegations that the firm failed to adequately supervise a broker churned investor accounts (Letters of Acceptance, Waiver and Consent NO. 2016052655301).

Investor Losses Due to Excessive Trading: Summit Brokerage Services

Excessive trading (churning) occurs when a financial advisor or brokerage firm makes an unreasonable quantity of trades within a customer’s account. While these frequent trades generate considerable commissions and fees for the broker-dealer, they also virtually guarantee the individual investor will suffer steep losses.

In this case, FINRA determined that an unidentified Summit Brokerage representative engaged in a pattern of excessive trading on at least 14 different customer accounts between January of 2012 and March of 2017. As a result of these excessive and unsuitable transactions, Summit Brokerage generated more than $300,000 in commissions and fees while the affected investors suffered nearly $600,000 in losses.

Notably, FINRA assessed that the failure to supervise by Summit Brokerage allowed this misconduct to occur and persist. Without admitting or denying wrongdoing, Summit agreed to pay a $325,000 fine and $558,296.44 in financial restitution.

Jeffrey R. Sonnis an investment fraud lawyer with extensive experience handling excessive trading claims. If you are a Summit Brokerage Services customer who suffered losses as a result of broker churning, Mr. Sonn is here to help. Contact us today for a free, no obligation case evaluation.