Joshua Nicholas Banned By FINRA And National Futures Association

Joshua Nicholas (Joshua David Nicholas CRD# 6529944) is a former registered broker and investment adviser whose last known employer was Merrill Lynch, Pierce, Fenner & Smith Incorporated (CRD#:7691) of Stuart, FL. Nichols previously worked for Midtown Partners of Chicago, IL, which was expelled by FINRA on 3/13/2020. He has been in the industry since. 2016.

Merrill Lynch terminated Nicholas’ is employment on 7/29/20 after his voluntary resignation. It was alleged that Nicholas forged a client document. The firm filed an amended Form U5 on August 14, 2020, which included information about his outside business activities (OBA), along with the arbitration with two customers that included selling away, unsuitable investment recommendations and omission of material facts.

Less than two weeks later, on 8/10/2020, a customer dispute was filed by trustees, who listed the above allegations in February of 2020. This dispute was settled for $275,000.

After an action filed by the National Futures Association, this agency suspended him from membership in NFA. At issue is the failure of both Nicholas and his registered commodity trading advisor, JDN Capital, LLC to cooperate and to produce documents and information requested during its investigation. The topic is a $300,000 loan for securities trading that JDN Capital and Nicholas solicited with misleading information. Once he received the funds, he misappropriated some of them and used for personal expenses rather than invest them in futures trading as he said. Nicholas also provided the clients with a fabricated brokerage statement that showed a non-existent brokerage account. He failed to provide bank records to the NFA to show what he actually did with the funds he received.

In the initial action, dated 9/11/2020, the NFA suspended Nicholas from that day until 11/16/2020. In the second action, dated 11/8/2020, the NFA fined Nicholas $125,000 and banned him from applying for NFA membership or associate membership, nor act as or become a principal of any NFA member.

FINRA’s separate action targeted Nicholas’ outside business activities (OBA) which included trading resulting in two customers’ losses of more than $1M. He then approached the customers to borrow $300,000 so that he and his company, JDL Capital, LLC, could do some additional futures trading investments for them. The promissory note involved was, allegedly, secured by the securities in the account. Unfortunately, no such account existed. The customers repeatedly asked Nicholas for an account statement, so he sent the clients a falsified brokerage statement alleged to be from a FINRA member firm. Additionally, Nicholas failed to notify Merrill, Lynch of his OBA involved in private securities transactions. FINRA’s findings indicated that Nicholas took $58,000 of the $300K and used them for personal expenses.

Following the FINRA investigation, Nicholas then signed a Letter of Acceptance, Waiver & Consent (AWC), agreeing to sanctions including an indefinite and permanent bar from association with any FINRA member in all capacities, effective 1/24/2022.

Did You Invest With Joshua Nicholas?

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