Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) indicate that broker/advisor, Larry Michaels (CRD # 4351477) was recently suspended from the securities industry by FINRA’s Department of Enforcement after an investigation into unauthorized discretion.
The Law Office of Kevin J. Deloatch, Esq. is interested in speaking to investors who have complaints regarding Mr. Michaels.
Registration Background for Larry Michaels
Mr. Michaels first became registered in the securities industry in 2001. He is currently registered with Orange, CA based Crown Capital Securities, L.P. (CRD # 6312). His prior registrations include Legacy Advisory Group, Inc. (CRD # 328470) from December 2023 to April 2024, J P Turner & Company Capital Management, LLC (CRD # 124446) from October 2009 to October 2012, and J.P. Turner & Company, L.L.C. (CRD # 43177) from October 2009 to October 2012.
FINRA’s Allegations Against Larry Michaels
According to the FINRA Letter of Acceptance, Waiver and Consent (AWC) dated April 18, 2024 (No. 2020069057401), Mr. Michaels consented to, without either admitting to or denying, the following findings by FINRA’s Department of Enforcement:
- “From September 2020 to October 2020, [Mr.] Michaels exercised discretionary authority when placing 51 trades in 17 non-discretionary brokerage accounts belonging to 14 customers without having communicated with the customers prior to the execution on the dates of the trades”;
- “[Mr.] Michaels did not have written authorization to exercise discretion in the 17 accounts. Moreover, Crown Capital did not accept any of the 17 customer accounts as discretionary and the firm’s Written Supervisory Procedures prohibited the exercise of discretionary authority in brokerage accounts”;
- “Additionally, from at least October 2018 to the present, [Mr.] Michaels failed to notify Crown Capital about the full nature of his participation in an outside business activity”;
- “Additionally, [Mr.] Michaels acted as an incorporator and filed articles of incorporation for several businesses on behalf of his Accounting Company clients, and was listed as a governor, who had the authority to make decisions on behalf of, at least one company”;
- “In providing these services to his Accounting Company clients, [Mr.] Michaels engaged in an outside business activity without providing full and accurate prior written notice to Crown Capital”; and
- By virtue of his actions, Mr. Michaels violated FINRA Rule 3260(b) regarding discretionary accounts, FINRA Rule 3270 regarding outside business activities, and FINRA Rule 2010 regarding standards of commercial honor and principles of trade.
FINRA Suspends Larry Michaels from Securities Industry
As a result of such violations and in addition to the above-described findings and conclusions, FINRA’s April 18, 2024 AWC also indicates that Mr. Michaels consented to the following sanction(s):
- a two-month suspension from association with any FINRA member in all capacities; and
- a fine in the amount of $10,000.00.
Larry Michaels Has A Prior History of Securities Industry Customer Complaints
In addition to Mr. Michaels being suspended by FINRA from the securities industry regarding various sales practice violations, FINRA BrokerCheck for Mr. Michaels reveals that he has a prior history of customer complaints and/or customer-initiated arbitrations, including but not necessarily limited to the following:
- On December 1, 2020, a customer initiated a written complaint against Mr. Michaels regarding alleged actions that occurred while he was associated with Crown Capital Securities, L.P. The customer alleged they were unaware of mutual fund redemptions. The customer further alleged damages in the amount of $10,000.00. On December 16, 2020, the complaint was settled in the amount of $24,300.00. Mr. Michaels was required to pay $5,000.00 of the settlement amount.
- On August 21, 2014, a customer-initiated arbitration was commenced against Mr. Michaels regarding alleged actions that occurred while he was associated with Crown Capital Securities, L.P. The customers’ allegations included, but were not necessarily limited to fraud, negligence, breach of fiduciary duty, unsuitable recommendations. The customer further alleged damages in the amount of $295,000.00. On May 20, 2016, the arbitration was settled in the amount of $200,000.00.
Have You Lost Money with Larry Michaels?
If you or someone you know has or had a brokerage account with Mr. Larry Michaels 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 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.
