FINRA Suspends Broker John Valliades After Allegations of Purchasing Investments Without Sufficient Authorization

Valliades was also routinely accused of churning by former customers

According to the Financial Industry Regulatory Authority (FINRA), New York Broker John Valliades was involved in a regulatory dispute that occurred while he was employed with Petersen Investments, Inc., in New York, NY. FINRA also reports that Valliades “consented to sanctions and to the entry of findings that he exercised discretion in three customers” accounts without obtaining prior written authorization from customers.

The findings stated that while Valliades and his customers spoke and agreed upon investments for the customers’ accounts, he exercised time and price discretion in executing transactions on dates when he had not spoken with the clients. As a result, Valliades was suspended for 20 days from working in any capacity in the securities industry and fined $5,000.

In addition to his FINRA regulatory violations, Valliades has had multiple disputes with customers, several of which accuse him of actions including churning, fraud, making unauthorized transactions, and the use of misleading, high-pressure sales tactics. In aggregate, Valliades and his employers have paid out more than three quarters of a million dollars’ to settle these claims.

Broker John Valliades has 8 customer disputes on his FINRA BrokerCheck Report

In a customer dispute that occurred while Valliades was working for Petersen Investments, Inc., a customer alleged that Valliades engaged in churning, unauthorized transactions, fraud, and failure

to supervise employees in regards to equity investments that the customer had made. The customer alleged $400,000 in damages, and Valliades settled for $285,000.

In another customer dispute that also occurred while Valliades was working for Petersen Investments, Inc., a customer alleged that Valliades used hard sales tactics regarding the purchase of options and improperly declared them as “safe” and “risk free.” The customer alleged $103,500 in damages, and Valliades settled for $23,600

In a separate customer dispute that occurred while Valliades was working for Gruntal & Co., L.L.C. a customer alleged that Valliades engaged in account churning, affected unsuitable trades and over-concentrated his account in speculative options strategies. The customer alleged $479,724 in damages, and Valliades settled for $7,500.

There are five other disputes that include allegations of unsuitability and unauthorized trading, but what all of them have in common are allegations of churning. Churning occurs when a broker makes numerous trades for the express purpose of generating additional commission, rather than serving the investment goals of a client.

Valliades’ career in the securities industry began in 1981. He started his career at Dean Witter Reynolds, Inc. in New York, NY. He would go on to work for a variety of other firms, including Gruntal & Co., L.L.C. in New York, NY, Wayne, Grayson Capital Corp. in Red Bank, NJ, Smith Barney, Inc. in New York, NY, Lehman Brothers, Inc. in New York, NY, Smith Barney, Harris Upham & Co. in New York, NY, and Petersen Investments, Inc. in New York, NY, where he currently works.

If you enlisted the services of John Valliades and have suffered losses as a result of this relationship, you may be able to recover some or all of your losses. You can find out more about the allegations against him by reviewing his BrokerCheck report, a complimentary service provided by FINRA.

The attorneys at Silver Law Group are leaders in the field of securities arbitration. We represent individual and institutional investors across the United States who have lost money at the hands of a trusted financial advisor. Our services are provided on a contingency-fee basis, which means we are only compensated if there is a recovery of losses. Contact us for a complimentary consultation about your situation.