David John Melilli of Moorestown, New Jersey, a stockbroker formerly registered with Cambridge Investment Research Inc., has been barred from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity supported by findings that Melilli executed unauthorized trades in a customer’s account during the time that he was associated with Sagepoint Financial Inc. and Cambridge Investment Research. Letter of Acceptance Waiver and Consent No. 2019063681001 (November 8, 2021).

According to the AWC, Melilli became the subject of a FINRA investigation around the time that he was terminated by Cambridge Investment Research. On January 23, 2020, he was discharged by the securities broker-dealer based upon allegations of his discretionary trading without written authorization.

The AWC states that on October 15, 2021, FINRA asked Melilli to provide information and documents to determine whether he made unauthorized trades in a customer’s account. Melilli was supposed to respond to FINRA by October 25, 2021, but failed to do so. The regulator states that it received a phone call from Melilli on November 3, 2021. Melilli relayed that he received the request and would not comply at any time. Melilli’s failure to respond prevented FINRA from determining whether he violated FINRA rules on discretionary trading. However, Melilli was barred for obstructing FINRA’s investigation in violation of FINRA Rules 2010 and 8210.

FINRA Public Disclosure reveals that Melilli has been identified in three customer initiated investment related disputes regarding accusations of his sales practice violations while employed by securities broker-dealers, including Cambridge Investment Research and Sagepoint Financial. On February 19, 2020, a customer filed an investment related FINRA securities arbitration claim regarding Melilli’s conduct where they requested $140,000.00 in damages founded upon allegations that their account was churned by Melilli when he was registered with Sagepoint Financial. FINRA Arbitration No. 20-00582 (February 19, 2020). According to the claim, unsuitable and unauthorized options transactions were effected by Melilli. The claim also contains accusations of breach of fiduciary duty and fraud.

Melilli is referenced in another customer initiated investment related written complaint on September 4, 2020, in which the customer sought compensatory damages supported by allegations that they were placed into unsuitable stocks by Melilli while he was employed by Cambridge Investment Research. According to the complaint, the customer was not informed about the risks relating to the investments. The claim also alleges that management fees charged to the customer were not appropriate.

On September 8, 2020, an additional customer filed an investment related complaint involving Melilli’s activities where they requested compensatory damages based upon accusations that unauthorized trades were executed in their account by Melilli at Sagepoint Financial.

Melilli was registered with Sagepoint Financial between January 25, 2010, and August 21, 2019, LPL Financial between July 11, 2018, and July 31, 2018, and Cambridge Investment Research between September 16, 2019, and February 4, 2020.

Tags: , ,

Comments are closed.