William Athes (William Nicholas Athes CRD#: 3165470) is a currently registered broker employed by SW Financial (CRD#: 145012 of Melville, NY.) His previous employers include Worden Capital Management LLC (CRD#:148366), also of Melville, K.C. Ward Financial (CRD#:145135) of Ronkonkoma, NY, and Securities America, Inc. (CRD#:10205) of Port Jefferson, NY. He has been in the industry since 1999.
A client filed a dispute on 5/4/2020 alleged that from 5/2/2019 to 4/23/2020, Athes engaged in unsuitable trading, breach of contract and fiduciary duty, and churning. This claim is pending, and the client requests damages of $84,932.35.
Following this dispute, FINRA began an investigation and issued a preliminary determination on 9/14/2020 to recommend disciplinary action against Athes after allegations of churning, unsuitable recommendations, and other similar allegations.
A previous client dispute filed on 1/30/2017 alleged Violations of Texas State Securities Act, excessive training, churning, breach of fiduciary duty, and other additional violations. The client requested damages of $290,000, and the claim was settled for $95,000.
Athes also has a civil judgment dated 4/27/2015 for $5,243.00.
Five previous customers filed disputes against Athes with similar allegations of churning and unauthorized trading from 2004 through 2011 were settled for various amounts. Two additional disputes were denied.
Multiple disputes allege that Athes engaged in churning, which is when a broker trades excessively just to generate trading commissions. It’s a violation of securities laws and FINRA rules.
Under FINRA Suitability Rule 2111 stockbrokers must have a reasonable basis for recommending a series of transactions in a customer’s account. Transactions that may appear suitable when viewed in isolation could be excessive when viewed in aggregate given the customer’s investment profile.
Churning is one the top controversies raised in customer arbitration claims. A FINRA arbitration claim for excessive trading or “churning” will be successful if the stockbroker controlled or solicited the activity in the account and the activity in the account was excessive based on the customer’s investment objectives and risk tolerance.
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