Jeffrey Allan Broten of Morristown New Jersey a stockbroker formerly registered with First Standard Financial Co. LLC and National Securities Corporation is referenced in a customer initiated investment related arbitration claim in which the customer sought $100,000.00 in damages based upon allegations that over-the-counter equities transactions effected in the customer’s account by the stockbroker failed to be suitable for the customer. Financial Industry Regulatory Authority (FINRA) Arbitration No. 20-00850 (May 24, 2020).
Broten has been identified in four additional customer initiated investment related disputes containing accusations of his misconduct during the period that he was employed by securities broker dealers including Merrill Lynch and Salomon Smith Barney. FINRA Public Disclosure confirms that Broten is the subject of a customer initiated investment related arbitration claim where the customer was awarded $48,591.00 in compensatory damages supported by allegations of Broten’s negligence with regard to a limited partnership interest. Another customer initiated investment related complaint involving Broten’s conduct was settled for $57,000.00 in damages supported by accusations that the customer had been steered by Broten towards investing in unsuitable investments including over-the-counter equities when Broten was associated with Merrill Lynch.
Broten is also identified in a customer initiated investment related arbitration claim which was settled for $49,500.00 in damages founded on allegations of Broten’s negligence and violation of both state and federal securities laws in regard to his trading at Merrill Lynch. According to the claim, a contract between the customer and the securities broker dealer had been breached. A fiduciary duty that was owed to the customer had allegedly been violated and the customer was defrauded. The claim also alleges unauthorized transactions and that the customer’s account had been churned by the stockbroker.
Another customer initiated investment related arbitration claim involving Broten’s conduct was settled for $87,000.00 in damages based upon accusations of breach of fiduciary duty and breach of contract relating to Broten’s actions at Salomon Smith Barney. The claim also alleges that NYSE and NASD rules were violated and that the customer was exposed to Broten’s excessive and fraudulent transactions.
Broten has also been fined and his stockbroker registration has been revoked according to a Summary Denial, Revocation and Penalty Order issued by New Jersey Bureau of Securities based upon findings of Broten’s fraud while registered with First Standard Financial Company. In the Matter of Jeffrey A. Broten (Feb. 6, 2020). According to the regulator, Broten engaged in a pattern of unauthorized and unsuitable trades in customer accounts. The stockbroker received large fees and commissions from customers who experienced losses. The strategy Broten recommended was designed to enrich himself financially at the expense of his customers’ interests.
The regulator also noted that Broten had been paid on purchases and sales effected in customers’ accounts through a short-term trading strategy. His transactions made it nearly impossible for customers to generate a profit as his fees and costs eroded investor returns. New Jersey pointed out that Broten’s customers had cost-to-equity ratios ranging from 19 percent to 25 percent. The regulator determined that Broten effected trades through fraudulent means which included his unauthorized and excessive trading as well as his use of margin in customer accounts. Broten’s conduct was violative of New Jersey securities laws including NJSA 49:3-52(b), NJSA 49:3-52(c), NJSA 49:3-58(I), NJSA 49:3-58(a)(2)(vii), and NJAC 13:47A-6.3(a).
Broten’s registration with First Standard Financial Company has been terminated as of August 28, 2019. He was registered with Newbridge Securities Corporation between August 21, 2019 and December 19, 2019.
