FINRA Complaint Alleges Broker Kishan Parikh made Unsuitable Investments, Excessive Trades

March 2021 - FINRA Complaint Alleges Broker Kishan Parikh made Unsuitable Investments, Excessive Trades

FINRA has filed a complaint against financial advisor Kishan Parikh (Sean Parikh, CRD #5506554) for allegations of excessive trading and unsuitable recommendations.


FINRA alleges that Parikh, while associated with Aegis Capital Corp. made unsuitable recommendations and excessively traded the accounts of five of his customers, from August 2014 through November 2016. Parikh, who purportedly controlled the trading in the Customers’ accounts, allegedly executed 442 trades with a total principal value of approximately $31.1 million.

Parikh’s alleged excessive and unsuitable trading resulted in annualized turnover rates ranging from 10.9 to 199.8 and annualized cost-to-equity ratios (or break-even points) ranging from 27.5% to 59.7%, according to FINRA. Consequently these trades reportedly caused combined losses of more than $33,000. Apparently at the same time, Parikh’s trading purportedly generated gross sales credits and commissions of $179,112, of which Parikh received at least $89,000.

The Financial Industry Regulatory Authority Censures and Fines AEGIS CAPITAL CORPORATION

July 2019 The Financial Industry Regulatory Authority (FINRA) censured and fined Aegis Capital Corp. $93,125 for its alleged failure to file certain documents specified with FINRA after it had filed such documents with the SEC. According to FINRA, these documents have yet to be filed with FINRA. In addition, the firm filed certain documents between four days and over two years late. In connection with two prospectuses, the firm purportedly failed to disclose a total of $14,000 in fees and compensation for the underwriter’s counsel, according to FINRA’s findings.

This is not the first time Aegis has been in trouble with regulators.
Aegis Capital Corp. & Broker Misconduct
There have been numerous cases of registered representatives affiliated with Aegis Capital Corp. who were allegedly involved in broker misconduct and fraudulent activities.
March 2021 - FINRA Reportedly Suspends Edmund Zack After Allegations of Excessive, Unauthorized and Unsuitable Trading

FINRA reportedly suspended former Aegis Broker, Edmund Zack (CRD#2215116) on March 19, 2021 for eight months after allegations of excessive, unauthorized and unsuitable trading. He was also fined $10,000 and ordered to pay disgorgement of $5,161 from commissions.

Between November 2014 and September 2015, Zack allegedly made unsuitable stock recommendations to, and engaged in excessive and quantitatively unsuitable trading in the Aegis account held by one of his customers, according to a Letter of Acceptance Waiver and Consent (AWC).

In October 2017, Zack also purportedly exercised discretionary trading authority to effect sales of securities in 27 customers’ accounts without having obtained prior written authorization from the customers or approval from Aegis to treat the accounts as discretionary, according to the AWC.

The White Law Group Investigates Potential Securities at AEGIS CAPITAL CORP.

Summary
The White Law Group is investigating potential securities claims involving Aegis Capital Corp. (CRD #15007, New York, NY).

Aegis Capital Corp., a mid-sized broker-dealer based in New York City, has 36 regulatory events, according to the Financial Industry Regulatory Authority (FINRA).

The firm was apparently at the top of the list of the worst ranked brokerage firms in the securities industry from 2007-2016, according to a report by the Securities Litigation & Consulting Group (SLCG).

The firm’s white paper “Rating Brokerage Firms by Their Complaint Histories Rather Than by Their Brokers’ Histories” found that while “only 2.6 percent of the brokers at firms with more than 200 brokers have customer complaints, Aegis Capital (24.49 percent) employs bad brokers (with complaints) at nearly 10 times that rate.”
Most recently, the Financial Industry Regulatory Authority (FINRA) has censured and fined Aegis Capital Corp. for corporate bond overcharges.
March 10, 2021 FINRA Censures and Fines Aegis Capital Corp. for allegedly failing to give favorable pricing to customers in connection with 26 corporate bond transactions.


Aegis reportedly also violated Municipal Securities Rulemaking Board Rules G-30 and G-17 by failing to purchase municipal securities for its own account from a customer, or sell municipal securities for its own account to a customer, at an aggregate price (including any mark-up or mark-down) that was fair and reasonable in connection with two municipal bond transactions.

Aegis was censured and fined $80,000 and ordered to pay restitution to customers in the total amount of $43,912.89 plus interest.