Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) indicate that broker, Serge Parakhnevich (CRD # 5493064) was recently suspended from the securities industry by FINRA’s Department of Enforcement. The sanction occurred as a result of an investigation into the unauthorized use of discretion in customer accounts. The Law Office of Kevin J. Deloatch, Esq. is interested in speaking to investors who have complaints regarding Mr. Parakhnevich.
Registration Background for Serge Parakhnevich
Mr. Parakhnevich first became registered in the securities industry in 2008 and is currently associated with New York, NY based PHX Financial, Inc. (CRD # 144403). His prior registrations include Aegis Capital Corp. (CRD # 15007) from June 2013 to April 2015, John Thomas Financial (CRD # 40982) from December 2011 to June 2013 and Clark Dodge & Co, Inc. (CRD # 23288) from September 2010 to December 2011.
FINRA’s Allegations against Serge Parakhnevich
FINRA’s investigation led to Mr. Parakhnevich entering into a Letter of Acceptance, Waiver and Consent (AWC) with FINRA on August 6, 2020. According to the AWC, Mr. Parakhnevich consented to, without either admitting to or denying, the following findings by FINRA’s Department of Enforcement:
- “From September 21, 2017 through July 16, 2019, [Mr.] Parakhnevich executed at least 96 trades in a customer account without the customer’s prior written authorization or the firm’s approval of the account as discretionary….”;
- “[Mr.] Parakhnevich exercised discretion without Firm approval on at least 96 occasions in the account of senior Customer A”;
- “Although Customer A was generally aware of the fact that [Mr.] Parakhnevich was exercising discretion in his account, [Mr.] Parakhnevich failed to obtain prior written authorization from Customer A”;
- “[Mr.] Parakhnevich also never obtained PHX Financial’ s approval of Customer A’s account as a discretionary account”;
- “During the relevant period, PHX Financial required registered representatives to complete an annual compliance questionnaire attesting to their compliance with certain firm policies and procedures including, among other things, the exercise of discretionary trading in customer accounts”;
- “On November 11, 2018 and February 4, 2019, [Mr.] Parakhnevich completed and submitted a compliance questionnaire to the firm”;
- “Each of the questionnaires contained the question, “[d]o you handle any customer accounts on a discretionary basis?“;
- “In each questionnaire, [Mr.] Parakhnevich answered “no” in response to this question”;
- “[Mr.] Parakhnevich’s answers were false because, at the time he responded to these questions, he was actively effecting transactions in Customer A’s account on a discretionary basis”; and
- By virtue of the above, Mr. Parakhnevich violated NASD Rule 2510(b), FINRA, Rule 3260(b) and FINRA Rule 2010.
FINRA Sanctions Serge Parakhnevich
As a result of such violations and in addition to the above described findings and conclusions, FINRA’s August 6, 2020 AWC also indicates that Mr. Parakhnevich consented to the following sanction(s):
- A 45 calander day suspension from association with any FINRA member firm in any capacity; and
- A fine in the amount of $7,500.00.
Serge Parakhnevich has a History of Complaints
In addition to the findings of FINRA’s Department of Enforcement, FINRA BrokerCheck for Mr. Parakhnevich (pages 12 – 15) reveals he has a history of customer complaint(s)/arbitration(s) including, but not limited to the following:
- On August 17, 2015, a customer initiated a written complaint against Mr. Parakhnevich for actions that allegedly occurred while he was associated with Aegis Capital Corp. The customer alleged unauthorized trading, excessive trading and churning. The customer further alleged Mr. Parakhnevich’s actions resulted caused damages in the amount of $100,000.00. On June 15, 2017, the complaint was denied.
- On January 20, 2020 a customer initiated an arbitration naming Mr. Parakhnevich as a respondent for actions that allegedly occurred while he was associated with Aegis Capital Corp. The customer alleged unsuitability, breach of contract and breach of fiduciary duty, causing damages in the amount of $249,281.00. The arbitration is currently pending.
If you or someone you know has or had a brokerage account with Mr. Serge Parakhnevich 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.
