Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) indicate that broker/advisor Joseph Kelly (CRD # 4560737) was recently suspended from the securities industry by FINRA’s Department of Enforcement after an investigation into excessive and quantitatively unsuitable trades (churning) that were not in the customer’s best interest (Reg BI).
The Law Office of Kevin J. Deloatch, Esq. is interested in speaking to investors who have complaints regarding Mr. Kelly.
Registration Background for Joesph Kelly
Mr. Kelly first became registered in the securities industry in 2003. He was most recently registered with New York, NY based VCS Venture Securities (CRD # 127921) since December 2024. He was previously registered with Spartan Capital Securities, LLC (CRD # 146251) from January 2017 to December 2024, PHX Financial, Inc. (CRD # 144403) from September 2016 to January 2017 and National Securities Corporation (CRD # 7569) from February 2016 to October 2016.
FINRA’s Allegations Against Joseph Kelly
According to the FINRA Letter of Acceptance, Waiver and Consent (AWC) dated August 22, 2025 (No. 2018056490332), Mr. Kelly consented to, without either admitting to or denying, the following findings by FINRA’s Department of Enforcement:
- “Between May 2017 and February 2023, [Mr.] Kelly recommended to four retail customers a series of trades that were excessive, quantitatively unsuitable, and not in the customers’ best interests”;
- “Customers A, C, and D, to whom [Mr.] Kelly made relevant recommendations between May 2017 and November 2019, relied on [Mr.] Kelly’s advice, and routinely followed his recommendations—as a result, [Mr.] Kelly exercised de facto control over those customers’ accounts”;
- “[Mr.] Kelly’s recommendations to the four customers resulted in turnover rates and cost-to-equity ratios that exceeded the traditional guideposts of six and 20 percent, respectively, as well as significant losses”;
- “…[Mr.] Kelly’s recommendations to the customers resulted in turnover rates of 10 to 35 and cost-to-equity ratios of 42% to 171% while generating $365,344 in total commissions and causing $262,683 in total realized losses” and
- By virtue of his actions, Mr. Kelly violated Exchange Act Rule 15/-l(a)(l) regarding Best Interest (Reg BI), FINRA Rule 2111 regarding suitability and FINRA Rule 2010 regarding standards of commercial honor and principles of trade.
FINRA Suspends Joseph Kelly from Securities Industry
As a result of such violations and in addition to the above-described findings and conclusions, FINRA’s August 22, 2025 AWC also indicates that Mr. Kelly consented to the following sanction(s):
- a nine-month suspension from association with any FINRA member in all capacities;
- a fine in the amount of $10,000.00;
- restitution in the amount of $69,830.00, plus interest.
Joseph Kelly Has A Prior History of Securities Industry Customer Complaints
In addition to Mr. Kelly being suspended by FINRA from the securities industry regarding various sales practice violations, FINRA BrokerCheck for Mr. Kelly reveals that he has a prior history of customer complaints and/or customer-initiated arbitrations, including but not necessarily limited to the following:
- On September 27, 2018, a customer-initiated arbitration was commenced against Mr. Kelly regarding alleged actions that occurred while he was associated with Spartan Capital Securities. The customer’s allegation(s) included suitability and excessive trading (churning). The customer further alleged damages in the amount of $1,082641.00. On July 24, 2023, the arbitration was withdrawn, and the customer was compensated in the amount of $30,000.00.
- On April 4, 2016, a customer-initiated arbitration was commenced against Mr. Kelly regarding alleged actions that occurred while he was associated with Spartan Capital Securities. The customer’s allegation(s) included misrepresentation and excessive trading (churning). The customer further alleged damages in the amount of $450,000.00. On November 1, 2017, the arbitration was settled in the amount of $225,365.00.
Have You Lost Money with Joseph Kelly?
If you or someone you know has or had a brokerage account with Mr. Joseph Kelly and have concerns regarding losses in your investments or possible sales practice violations including fraud, you may be entitled to recover lost funds. The Law Office of Kevin J. Deloatch, Esq. has an extensive securities law practice and over 35 years of experience on Wall Street. Call today at (646) 792-2156 for a free consultation. The time to file your claim may be limited so you should call today to avoid delay.
