FINRA Commenced Disciplinary Proceedings Against Daniel O’Neill for Churning 2Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) indicate that the FINRA Department of Enforcement recently commenced disciplinary proceedings against broker, Daniel O’Neill (CRD # 1358245) regarding allegations of quantitatively unsuitable trading (churning) in a customer account.

The Law Office of Kevin J. Deloatch, Esq. is interested in speaking to investors who have complaints regarding Mr. O’Neill.

Registration Background for Daniel O’Neill

Mr. O’Neill first became registered in the securities industry in 1985. He was most recently registered with Melville, NY based Aegis Capital Corp. (CRD # 15007).  His previous registrations include but are not necessarily limited to Ladenburg Thalmann & Co., Inc. (CRD # 505) from March 2011 to Maxim Group LLC (CRD # 120708) from August 2007 to April 2011.

FINRA’s Churning Allegations Against Daniel O’Neill

According to a Complaint filed by the Department of Enforcement with FINRA’s Office of Hearing Officers (OHO) dated July 29, 2021, FINRA’s Department of Enforcement has made the following allegations of churning against Daniel O’Neill:

  • From July 2014 through June 2015, [Mr.] O’Neill recommended active short-term trading in Customer A’s Aegis account supported by the use of margin”;
  • [Mr.] O’Neill executed 456 purchases and sales of securities totaling approximately $22.9 million in Customer A’s account, resulting in an annualized turnover rate of 51.4 and an annualized cost-to-equity ratio of 63.7%”;
  • [Mr.] O’Neill did not calculate cost-to-equity or turnover rates, or consider the cumulative trading costs Customer A incurred when determining which stocks to buy and sell.
  • [Mr.] O’Neill also did not consider the interest costs associated with his use of margin, which allowed [Mr.] O’Neill access to additional funds so he could trade more frequently and thus increased the costs Customer A incurred”;
  • From July 30, 2014 through April 27, 2015, [Mr.] O’Neill executed 37 separate purchases and sales of 38,250 shares of Twitter (TWTR) stock worth approximately $1.9 million, resulting in a net loss of $10,764 and $7,900 in commissions, markups and markdowns;
  • From August 20, 2014 through September 8, 2014, [Mr.] O’Neill executed 18 separate purchases and sales of 10,000 shares of Hertz Global Holdings Inc. (HTZ) even though the share price remained largely the same. Customer A incurred a net loss of $3,197.56, while  [Mr.] O’Neill charged $2,599.90 in markups and markdowns on the trades”;
  • From July 30, 2014 through August 21, 2014, [Mr.] O’Neill executed 5 separate purchases and sales of 5,000 shares of Yahoo (YHOO), generating a $1,570.55 profit”;
  • From September 17, 2014 through September 24, 2014, [Mr.] O’Neill executed 7 separate purchases and sales of 4,500 shares of Sunoco LP (SUNE), resulting in a net loss of $1,494.09. O’Neill charged $1,275 in markups and markdowns on the trades”;
  •  “As a result of  [Mr.] O’Neill’s active short-term trading, by the end of June 2015, the value of Customer A’s account was $150,071.52, consisting of $169,559.28 in securities and a -$19,487.16 cash balance”;
  • [Mr.] O’Neill’s excessive and unsuitable trading in Customer A’s account during the Relevant Period generated total trading costs of $140,109 (of which  [Mr.] O’Neill earned at least $66,000), margin interest charges of $14,508, and caused losses of $147,411”; and
  • By virtue of his actions, Mr. O’Neill violated FINRA Rule 2111, regarding suitability and FINRA Rule 2010, regarding standards of commercial honor and principles of trade.

Daniel O’Neill Has A History of Securities Industry Customer Complaints

In addition the FINRA Department of Enforcement commencing disciplinary proceedings against Daniel O’Neill for quantitatively unsuitable trading (churning), FINRA BrokerCheck for Mr. O’Neill reveals he has a history of customer complaints and/or customer initiated arbitrations, including but not necessarily limited to the following:

  • On February 16, 2016, a customer initiated a written complaint against Mr. O’Neill regarding alleged actions that occurred while he was associated with Aegis Capital Corp. The customer alleged unauthorized trading and misuse of margin. Although the customer did not allege a specific dollar amount in damages, the firm made a good-faith determination of damages being in excess of  $5,000.00. On March 13, 2017 the complaint was settled in the amount of $12,500.00.
  • On February 1, 2021, a customer-initiated arbitration was commenced naming Mr. O’Neill as a respondent regarding alleged actions that occurred while he was associated with Aegis Capital Corp. The customer alleged unsuitability. The arbitration is currently pending.

If you or someone you know has or had a brokerage account with Daniel J. O’Neill and have concerns regarding losses in your investments or possible sales practice violations including fraud, churning or unsuitability, you may be entitled to recover lost funds. The Law Office of Kevin J. Deloatch, Esq. has an extensive securities law practice and over 30 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.