David Harrison Miller of Atlanta, Georgia, a stockbroker registered with PeachCap Securities Inc., has been barred from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity because Miller failed to testify when FINRA investigated the stockbroker for possible violations of FINRA rules during the time that he was associated with PeachCap Securities Inc. Letter of Acceptance, Waiver, and Consent No. 2019063946701 (July 27, 2023).
From 2019 to 2020, there were four instances of customer arbitrations involving Miller. FINRA began investigating these issues following a review of an arbitration claim statement from July 2019.
On July 10, 2023, as part of this investigation, FINRA reached out to Miller to gather formal testimony related to the suitability of his investment advice. However, Miller, through an email to the regulator on the same day, confirmed that he received their request. The regulator learned that Miller would not provide any formal testimony. By refusing to do so, Miller violated FINRA Rules 2010 and 8210.
Miller has been barred by Securities and Exchange Commission (SEC) because Miller made unsuitable recommendations and engaged in unauthorized trading. In the Matter of David H. Miller, Order No. 3-20689 (December 22, 2021).
According to SEC, Miller had formed a hedge fund called The Pessego Long Short Fund LP in April 2016. Miller then sold over $4,600,000.00 in limited partnership interests in this fund to some of his advisory customers and others. The promotional materials for the fund claimed that it aimed to offer attractive returns while keeping the capital safe, with a strategy focused on low exposure. However, the fund’s trading was risky and did not align with its investment objectives. Plus, Miller suggested the fund to certain PeachCap Tax Advisory LLC (PCTA) customers, even during the time that it wasn’t a suitable investment for them. As a result, the fund lost over 90 percent of its value and had to terminate in 2017.
Between 2017 and 2018, PCTA conducted 492 principal trades with six advisory customers but didn’t provide the necessary transaction-specific notice or get consent. Additionally, PCTA didn’t have suitable written compliance policies to prevent violations of federal securities laws during these trades.
SEC also noted PCTA’s failure to have compliance protocols about volatility-linked exchange-traded products. This led to investment advisers using discretion over customer accounts to buy and keep a leveraged exchange traded funds for customers for a time period that contradicted the product’s intended use. This exposed the customers to an inappropriate risk of loss.
These actions resulted in Miller and PCTA violating Securities Act of 1933 and the Investment Advisers Act of 1940.
Financial Industry Regulatory Authority (FINRA) Public Disclosure shows that Miller is referenced in 10 customer initiated investment related disputes concerning Miller’s conduct while registered with securities broker dealers, including PeachCap Securities Inc. On July 15, 2019, a customer initiated investment related complaint involving Miller’s conduct was settled for $50,000.00 in damages based upon allegations that Miller recommended direct investments which poorly performed during the time that Miller was registered with PeachCap Securities Inc.
On March 3, 2021, a customer initiated investment related FINRA securities arbitration claim involving Miller’s conduct was settled for compensation based upon allegations that Miller mismanaged investment accounts. FINRA Arbitration No. 19-03552. Miller was also referenced in a customer initiated investment related FINRA securities arbitration claim that was settled for $24,000.00 in damages based upon allegations that Miller engaged in unsuitable trading of alternative investments including direct investments and real estate securities when Miller was registered with Investacorp Inc. FINRA Arbitration No. 20-02206 (April 13, 2021).
On April 29, 2021, another customer initiated investment related FINRA securities arbitration claim involving Miller’s conduct was settled for $455,000.00 in damages based upon allegations that Miller recommended bad real estate securities during the time that Miller was registered with PeachCap Securities Inc. FINRA Arbitration No. 20-00531.
Miller is also referenced in a customer initiated investment related civil action in which the customer requested compensation based upon allegations that Miller breached fiduciary duties in connection with the sale of investments through PeachCap Tax Advisory LLC. Civil Action No. 2021CV348012 (April 29, 2021).
Miller was registered with PeachCap Securities Inc. as a stockbroker from October 3, 2015, to December 17, 2021.
