Dominic Tropiano (CRD# 4761462) was a previously registered broker and investment adviser. In 2016, Mr. Tropiano worked for America Northcoast Securities based in Cleveland, Ohio.
Following a FINRA investigation, Mr. Tropiano was permanently barred from the industry for recommending unsuitable transactions involving non-traditional exchange-traded funds (Letter of Acceptance, Waiver and Consent No. 2016051098501).
According to FINRA, between May 2015 and April 2016 Mr. Tropiano recommended 866 transactions involving the exchange-traded funds (ETFs) to at least 47 customers without having a reasonable basis to believe the transactions were suitable.
As a result, Mr. Tropiano violated FINRA Rule 2111 which provides that brokers must have a reasonable basis to believe that a recommended transaction is suitable for the customer based on their investment profile. In at least two instances, Mr. Tropiano also engaged in trading without the customer’s knowledge or consent.
FINRA noted Mr. Tropiano’s unfamiliarity with the unique risks and operation of the ETFs, including their daily reset feature and underlying volatility, as the reason for his actions.
FINRA barred Mr. Tropiano from the industry but did not impose further sanctions because America Northcoast paid over $1.5 million to its customers for losses they suffered as a result of Mr. Tropiano’s actions.
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