National investment fraud lawyers KlaymanToskes is investigating Laidlaw & Co. brokers Edward Scott Short (CRD# 2462752) and Todd Anthony Cirella (CRD# 2396336) after both individuals were suspended, fined, and ordered to pay restitution for violations of the SEC’s Regulation Best Interest rule.
Investors that suffered losses with Edward Scott Short or Todd Anthony Cirella may be entitled to a financial recovery. Contact attorney Lawrence L. Klayman, Esq. immediately at (888) 997-9956 or lklayman@klaymantoskes.com to discuss your legal options at no cost.
Edward Scott Short entered into a letter of Acceptance, Waiver, and Consent (“AWC”) with FINRA’s Department of Enforcement on January 31st, 2023 which states that Short will remain suspended in all capacities for seven months from February 6th, 2023 to September 5th, 2023 and is required to pay a fine of $5,000 along with $116,859 in restitution to customers.
According to the AWC’s findings, between July 2018 and December 2020, Short recommended a series of trading in a 77-year-old retail customer’s account with “high net worth and a speculative investment objective.” Short recommended 204 transactions in the customer’s account, generating $116,859 in commissions and approximately $185,000 in trading losses, as well as an annualized cost-to-equity ratio of 76.53%, and an annualized turnover rate of 47.49.
According to FINRA’s Department of Enforcement, “The high cost-to-equity ratio meant the customer’s account would have to grow by more than 76 percent annually just to break even. This level of trading was excessive, unsuitable, and not in the customer’s best interest.”
In a related case, Todd Anthony Cirella entered into a letter of Acceptance, Waiver, and Consent (“AWC”) with FINRA’s Department of Enforcement on January 31st, 2023 which states that Cirella will remain suspended in all capacities for three months from February 21st, 2023 to May 20th, 2023 and is required to pay a fine of $5,000 along with $27,566 in restitution to customers.
According to the AWC’s findings, between June 2020 and January 2021, Cirella recommended 46 transactions in a 60-year-old retail customer’s account that generated $27,566 in commissions and approximately $12,000 in trading losses, as well as an annualized cost-to-equity ratio of 37.65%, and an annualized turnover rate of 20.39.
According to FINRA’s Department of Enforcement, “The high cost-to-equity ratio meant the customer’s account would have to grow by more than 37 percent annually just to break even, making it very difficult for the customer to realize a profit. This level of trading was excessive, unsuitable, and not in the customer’s best interest.”
Both Edward Short and Todd Cirella allegedly violated the Best Interest Obligation under Rule 15l-1 of the Securities Exchange Act of 1934 (Regulation BI) along with FINRA Rule 2111 (Suitability) and FINRA Rule 2010 (Principles of Trade).
SEC Regulation Best Interest, (Reg BI) falls under the securities exchange act of 1934, which establishes a “best interest” standard of conduct for brokers and brokerage firms making recommendations of securities investments and investment strategies to their clients.
FINRA-regulated brokers and brokerage firms have a responsibility to make recommendations with their client’s best interest in mind, based upon the client’s personal needs and preferences.
The SEC also requires brokers and investment advisors to provide a “brief relationship summary” known as form CRS, to their customers, which must be provided before or at the time they enter into an investment advisory contract with the broker or advisor. This form is used to provide investors information about investment-related services and fees.
When brokers and brokerage firms fail to act in the best interest of their clients, they are violating securities laws. Investors that suffer investment losses as a result of this violation may hold their broker and brokerage firm responsible through FINRA arbitration.
If you believe your advisor did not act in your best interest when managing your brokerage account, contact Lawrence L. Klayman, Esq. for a free, confidential consultation at 888-997-9956 or lklayman@klaymantoskes.com
According to Brokercheck, on January 23rd, 2023 Laidlaw & Co. received a regulatory order initiated by the state of Connecticut that fined the firm $200,000 and ordered it to cease and desist from regulatory violations.
The firm consented to the order, which alleged the following:
The consent order also alleged that from approximately 2017 to 2021, the firm:
According to national investment fraud attorney Lawrence L. Klayman, Esq., “The allegations of regulation best interest and other securities violations within the investor complaints filed against Edward Short and Todd Cirella may indicate a systemic issue at Laidlaw & Company’s New York branches. Other investors at these branch locations may have faced severe losses, and are encouraged to contact us to discuss their recovery options.”
The list below displays other currently registered individuals with notable red flags at Laidlaw & Co. branch locations in New York, NY and Melville, NY.
Bruce Alan Porter (CRD# 1811766)
Hugh Regan (CRD# 1254114)
Kenneth Mathieson (CRD# 1730324)
Richard G. Michalski (CRD# 4588706)
John Coolong (CRD# 5924271)
Devin Michael McCabe (CRD# 5645799)
Shane Cirella (CRD# 6807036)
KlaymanToskes encourages investors who did business with Edward Scott Short, Todd Anthony Cirella, the New York, NY and/or Melville, NY branches of Laidlaw & Co., and/or any of the brokers listed above to review their accounts for signs of broker misconduct and/or investment losses.
Investors that suffered significant losses should contact attorney Lawrence L. Klayman, Esq., at 888-997-9956, or lklayman@klaymantoskes.com to discuss their recovery options at no cost.
KlaymanToskes is a leading national securities law firm which practices exclusively in the field of securities arbitration on behalf of retail and institutional investors throughout the world in large and complex securities matters. The firm has recovered over $250 million in FINRA arbitrations and over $350 million in other securities litigation matters. KlaymanToskes has office locations in California, Florida, New York, and Puerto Rico.
Contact
Lawrence L. Klayman, Esq.
888-997-9956