Did you lose money investing with James Flower (CRD# 2817701)?
Galvin Legal, PLLC is launching an investigation on behalf of investors who may have suffered losses investing with James Flower. If you suffered losses investing with James Flower, then Galvin Legal, PLLC may be able to help you recover your losses in a Financial Industry Regulatory Authority (“FINRA“) arbitration claim.
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
As of February 6, 2023, James Flower’s FINRA BrokerCheck Report contains the following:
BARRED: FINRA has barred this individual from acting as a broker or otherwise associating with a broker-dealer firm.
Disclosure Events
4 Customer Disputes
2 Regulatory Events
1 Financial Disclosure
July 14, 2021 – An OHO decision became final in which Flower was barred from association with any FINRA member in all capacities and ordered to pay $242,014.46, plus prejudgment interest, in restitution to customers. The sanctions were based on findings that Flower churned customer accounts in willful violation of Section 10(b) of the Exchange Act, and Rule 10b-5 thereunder, and in violation of FINRA Rule 2020. The findings stated that Flower excessively traded the customer accounts in violation of FINRA rules regarding quantitative unsuitability. There were multiple signs of excessive trading and Flower’s misconduct rose to the level of churning because he traded for his own benefit, in reckless disregard of his customers’ interests, while exercising de facto control of the accounts. Flower repeatedly turned over or replaced all the securities in the accounts with new securities. The resulting annualized cost-to-equity ratios were also high, meaning that the customers would have to make back a large amount of money, sometimes more than the cash value in the account, to cover their expenses and break even. The customers could make no profit until the expenses were covered. The high cost-to-equity ratios made it virtually impossible that the accounts could be profitable. Flower also engaged in what is known as in-and-out trading in the accounts, buying and then selling the same stock in a matter of a few days. In addition, the customers were unsophisticated investors. None of the customers had actively traded securities before, none of them tracked what was happening in their accounts in any meaningful way and none of them had much of an understanding about the way securities brokers are paid or, in particular, how Flower was paid. In fact, Flower discouraged the customers from trying to understand what was going on in their accounts. The customers together suffered realized losses totaling roughly $223,000 and Flower charged commissions on the trading of nearly $185,000, of which he received 70 percent. The findings also stated that Flower effected unauthorized trades in a customer’s account. Flower engaged in all but one of the unauthorized trades while the customer was experiencing serious medical issues that interfered with his daily living. The trading resulted in more than $30,000 in market losses. The findings also included that Flower caused his member firm’s books and records to be false and inaccurate by mismarking transactions in accounts as unsolicited, when they were in fact solicited. Most of the purported unsolicited trades were sales at a loss and the mismarking of the sales as unsolicited made it seem that the customers had chosen to take the losses and helped obscure Flower’s excessive trading and churning. (FINRA Case #2017052701101)
Current and Previous Registrations
06/13/2019 – 06/25/2021 SPARTAN CAPITAL SECURITIES, LLC (CRD#:146251) GARDEN CITY, NY
12/01/2015 – 06/03/2019 SW FINANCIAL (CRD#:145012) Melville, NY
05/09/2014 – 12/14/2015 LAIDLAW & COMPANY (UK) LTD. (CRD#:119037) MELVILLE, NY
11/03/2010 – 05/12/2014 GLOBAL ARENA CAPITAL CORP (CRD#:16871) MELVILLE, NY
FINRA expelled the firm on 01/04/2016
10/29/2009 – 11/02/2010 PRESTIGE FINANCIAL CENTER, INC. (CRD#:30407) MELVILLE, NY
FINRA expelled the firm on 05/23/2011
08/26/2009 – 11/11/2009 BROOKSTONE SECURITIES, INC. (CRD#:13366) GARDEN CITY, NY
FINRA expelled the firm on 10/09/2012
04/30/2008 – 09/10/2009 PRESTIGE FINANCIAL CENTER, INC. (CRD#:30407) GARDEN CITY, NY
FINRA expelled the firm on 05/23/2011
04/09/2008 – 05/30/2008 OBSIDIAN FINANCIAL GROUP, LLC (CRD#:104255) WOODBURY, NY
FINRA expelled the firm on 10/16/2013
04/25/2006 – 04/15/2008 WESTROCK ADVISORS, INC. (CRD#:114338)
FINRA expelled the firm on 01/18/2011
WOODBURY, NY
08/18/2004 – 05/18/2006 J.P. TURNER & COMPANY, L.L.C. (CRD#:43177) GARDEN CITY, NY
08/04/2004 – 08/06/2004 WESTROCK ADVISORS, INC. (CRD#:114338)
FINRA expelled the firm on 01/18/2011
NEW YORK, NY
01/06/2004 – 07/23/2004 GRANITE ASSOCIATES, INC (CRD#:46682) DELRAY BEACH, FL
04/21/2003 – 01/21/2004 CONTINENTAL BROKER-DEALER CORP. (CRD#:14048) CARLE PLACE, NY
FINRA expelled the firm on 05/06/2004
01/02/2001 – 05/20/2003 HARRISON SECURITIES, INC. (CRD#:14103) PORT WASHINGTON, NY
FINRA expelled the firm on 12/16/2004
09/11/1998 – 12/31/2000 WHITEHALL WELLINGTON INVESTMENTS, INC. (CRD#:38022) PORT WASHINGTON, NY
01/16/1998 – 09/25/1998 TASIN & COMPANY, INC. (CRD#:30709) HAUPPAUGE, NY
FINRA expelled the firm on 09/05/2001
12/03/1997 – 01/22/1998 DUKE & CO., INC. (CRD#:8035) NEW YORK, NY
09/09/1997 – 11/20/1997 GAINES, BERLAND INC. (CRD#:14623) BETHPAGE, NY
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
Due Diligence Requirement
FINRA requires broker’s to conduct due diligence on investments and to conduct a suitability analysis when recommending securities to a customer that takes into account the customer’s knowledge and experience. FINRA Rule 2111(a) states that “a member or an associated person must have a reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer, based on the information obtained through the reasonable diligence of the member or associated person to ascertain the customer’s investment profile. A customer’s investment profile includes, but is not limited to, the customer’s age, other investments, financial situation and needs, tax status, investment objectives, investment experience, investment time horizon, liquidity needs, risk tolerance, and any other information the customer may disclose to the member or associated person in connection with such recommendation.”
Rule 2111 is composed of three main obligations: reasonable-basis suitability, customer-specific suitability, and quantitative suitability. Brokers and the brokerage firms they work for that fail to conduct adequate due diligence on investments they recommend or that make unsuitable recommendations can be held responsible for the customer’s losses in a FINRA arbitration claim.
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
Request a Free Consultation with a Securities Attorney
If you suffered losses investing with James Flower and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
This information is all publicly available and is being provided to you by Galvin Legal, PLLC.
Galvin Legal, PLLC is a national securities arbitration, securities mediation, securities litigation, securities fraud, securities regulation and compliance, and investor protection law practice. For more information on Galvin Legal, PLLC and its representation of investors, please visit www.galvinlegal.com or call 1-800-405-5117.
