Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) indicate that broker/advisor, Michael Nixon (CRD # 2169631) was recently suspended from the securities industry by FINRA’s Department of Enforcement after an investigation into unsuitable securities recommendations.
The Law Office of Kevin J. Deloatch, Esq. is interested in speaking to investors who have complaints regarding Mr. Nixon.
Registration Background for Michael Nixon
Mr. Nixon first became registered in the securities industry in 1991. He was most recently registered with Tampa, FL based Paulson Investment Company LLC (CRD # 5670) from December 2015 to January 2020. His prior registrations include Newport Coast Securities, Inc. (CRD # 16944) from June 2012 to January 2016, and Meyers Associates, L.P. (CRD # 34171) from October 2011 to February 2013.
FINRA’s Allegations Against Michael Nixon
According to FINRA Letter of Acceptance, Waiver and Consent (AWC) dated December 29, 2021, Mr. Nixon consented to, without either admitting to or denying, the following findings by FINRA’s Department of Enforcement:
- “On 11 occasions between January 2016 and September 2019, [Mr.] Nixon recommended that Customer A purchase a type of complex, structured product known as a “steepener” without having a reasonable basis for his recommendations, in violation of FINRA Rules 2111 and 2010”;
- “Steepeners are complex, structured products that usually have long maturities, generally between 10 and 30 years”;
- “Steepeners initially pay interest at an above-market “teaser” rate that is generally fixed for a short period of time, typically one year”;
- “The steepeners then reset to a floating interest rate based on the spread between longer- and shorter-term interest rates (i.e., the steepness of the yield curve), such as the spread between the 30-Year Constant Maturity Swap (CMS) rate and 2-Year CMS rate”;
- “Because the spread between longer and shorter-term interest rates can compress—meaning that the yield curve can flatten— investors holding steepeners can face periods of very little or zero interest”;
- “Additionally, there is no guaranteed secondary market for steepeners and thus—as non-conventional investments—the products “tend to have less market liquidity, less transparency as to their pricing and value and may entail significant credit risks”;
- “[Mr.] Nixon lacked an understanding of the risks associated with steepeners when he recommended that Customer A purchase them”; and
- By virtue of his actions, Mr. Nixon violated FINRA Rule 2111 regarding suitability; and FINRA Rule 2010, regarding standards of commercial honor and principles of trade.
FINRA Suspends Michael Nixon from Securities Industry
As a result of such violations and in addition to the above-described findings and conclusions, FINRA’s December 29, 2021 AWC also indicates that Mr. Nixon consented to the following sanction(s):
- A four-month suspension from association with any FINRA member in all capacities; and
- A fine in the amount of $5,000.00;
Michael Nixon Has A History of Securities Industry Customer Complaints
In addition to Michael Nixon being suspended by FINRA from the securities industry regarding unsuitable securities recommendations, FINRA BrokerCheck for Mr. Nixon reveals that he has a history of customer complaints and/or customer-initiated arbitrations dating back to as early as 1998. The most recent customer complaints/arbitrations include but are not necessarily limited to the following:
- On July 9, 2018 a customer-initiated arbitration was filed naming Mr. Nixon as a respondent regarding alleged actions that occurred while he was associated with Paulson Investment Company, LLC and Newport Coast Securities, Inc. The customers allegations included common law fraud, securities fraud, breach of fiduciary duty, suitability, negligence and breach of contract. The customer further alleged damages in the amount of $3,000,000.00. On August 13, 2019 the arbitration was settled in the amount of $192,500.00 with Mr. Nixon responsible for paying $42,500.00 of the settlement amount.
If you or someone you know has or had a brokerage account with Michael Patrick Nixon 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.