National investor fraud law firm, KlaymanToskes (“KT”), has commenced an investigation into former Aegis Capital broker Scott Hananel (“Scott Hananel Aegis Capital Investigation”) in light of recent FINRA customer disputes filed claiming investment losses relating to the former Melville, NY broker.
Scott Hananel Aegis Capital Investigation – BrokerCheck
According to FINRA BrokerCheck, former Aegis Capital broker Scott Neil Hananel was last registered with Aegis Capital Corporation (Branch Location was Melville, NY) from February 2010 to February 2021.
Scott Hananel’s FINRA BrokerCheck shows three pending customer disputes:
- February 2021. On February 1, 2021, customers filed a FINRA arbitration claim against Scott Hananel. The allegations state that Scott Hananel recommended unsuitable investments.
- January 2021. On February 29, 2021, a customer filed a FINRA arbitration against Scott Hananel. The allegations relate to breach of contract, breach of fiduciary duty and unsuitable investment recommendations relating to common and preferred stock.
- December 2020. On December 7, 2020, a FINRA arbitration was filed against Scott Hananel. The allegations relate to unsuitable investments, unauthorized trading and churning. The alleged damages are $50,000.
Former Aegis Capital Broker Scott Hananel and Customer Dispute Allegations Concerning Churning
As noted above, a December 2020 dispute against Mr. Hananel relates, in part, to churning. According to FINRA, brokerage firms and its financial advisors that excessively traded or “churn” a brokerage account are in violation securities industry rules and regulations.
In a FINRA arbitration claim of excessive trading or “churning” in a brokerage account, Claimants may allege a breach of fiduciary duty and conflict of interest for recommended investment strategies whose sole purpose is to enrich the brokerage firm and/or its financial advisor through excessive commissions, fees or costs. FINRA arbitrations will generally be successful in an excessive trading or “churning” claim if a customer can prove two case facts.
First, the panel must conclude the financial advisor controlled or solicited the activity in the account and, second, the activity in the account was excessive based on the Claimant’s risk tolerance and investment objectives. There are many factors an arbitration panel will consider to determine whether a financial advisor had control over the activity in a financial brokerage account. Several factors that may be considered include:
- Client Level of Sophistication;
- Unsuitable Investment Strategy Based on Objectives;
- Prior Transactions of a Similar Nature and Frequency;
- Client Trust and Reliance Upon a Financial Advisor;
- Time Client Devotes to Independent Research;
- Number of Transactions Solicited vs. Unsolicited;
- Similar Positions with Different Brokerage Firms; and
- Client Understanding of Investment Strategy.
Investment Losses with Scott Hananel at Aegis Capital?
Former customers of former Aegis Capital broker Scott Hananel with investment losses that exceed $100,000, and those who may have information relating to the manner in which the broker handled their accounts, are encouraged to contact Lawrence L. Klayman, Esq., at (561) 542-5131, and download our Special Investor Report.
KT 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. KT has recovered more than $220 million for investors in FINRA arbitrations. KT has office locations in California, Florida, New York, and Puerto Rico.