Joseph Brian Lascala Jr. (also known as Joe Lascala), of Melville, New York, a stockbroker registered with Aegis Capital Corp., is the subject of a customer initiated investment related complaint filed on March 15, 2023, in which the customer requested compensation based upon allegations that Lascala engaged in unauthorized trading during the time that Lascala was associated with Aegis Capital Corp.
Financial Industry Regulatory Authority (FINRA) Public Disclosure shows that Lascala is referenced in five other customer initiated investment related disputes concerning Lascala’s conduct while associated with securities broker dealers. A customer filed an investment related complaint involving Lascala’s conduct in which the customer requested $50,000.00 in damages based upon allegations that Lascala mismanaged investment accounts and overconcentrated accounts in certain over-the-counter equities when Lascala was associated with Investec Ernst Company. This complaint was denied by the securities broker dealer.
Lascala was also referenced in a customer initiated investment related FINRA securities arbitration claim that was settled for $275,000.00 in damages based upon allegations that Lascala failed to supervise certain representatives in connection with the recommendation and sale of stocks and over-the-counter equities during the time that Lascala was associated with GunnAllen Financial Inc. FINRA Arbitration No. 10-03873 (April 18, 2012).
On August 27, 2012, a customer initiated investment related FINRA securities arbitration claim involving Lascala’s conduct was settled for $6,250.00 in damages based upon allegations that Lascala failed to supervise certain representatives, resulting in churning of mutual funds and stocks when Lascala was associated with GunnAllen Financial Inc. FINRA Arbitration No. 11-04746.
Lascala was also referenced in a customer initiated investment related FINRA securities arbitration claim that was settled for $30,000.00 in damages based upon allegations that Lascala failed to supervise, resulting in unsuitable and excessive trading in over-the-counter equities and stocks during the time that Lascala was associated with Paulson Investment Company. FINRA Arbitration No. 11-04181 (October 31, 2012).
On November 27, 2012, a customer initiated investment related FINRA securities arbitration claim involving Lascala’s conduct was settled for $7,500.00 in damages based upon alleged failure to supervise and mismanagement of over-the-counter equities trading when Lascala was associated with GunnAllen Financial Inc. FINRA Arbitration No. 10-04182.
FINRA Public Disclosure shows that Lascala has been fined $7,500.00 and suspended for four months from associating with any FINRA member in any capacity because Lascala engaged in unsuitable and excessive trading. Letter of Acceptance, Waiver, and Consent No. 2021070337201 (January 24, 2022).
According to the AWC, LaScala was involved in frequent short-term trading activities within Customer A’s retirement account that was held at Aegis. LaScala executed 235 trades. These trades produced an annual cost-to-equity ratio of 29.16 percent and an annual turnover rate of 5.8. LaScala had a significant influence on the trading choices, determining which stocks to buy or sell and the timing for these transactions. He also had discretionary authorization for 139 of these trades. FINRA found that LaScala had substantial control over the activities and overall direction of Customer A’s investment account.
The level of short-term trading that LaScala conducted in Customer A’s account was excessive and inappropriate during the time that assessed against the customer’s objectives for investing and risk profile. The stockbroker’s trading led to expenses of $90,720.00 and losses of $116,194.00. As a result of these actions, LaScala was found by FINRA to have violated FINRA Rules 2010 and 2111.
Furthermore, Aegis had clear supervisory procedures that barred stockbrokers from making discretionary decisions in a customer’s account unless they had secured advanced written consent both from the customer and from the firm itself. Contrary to this protocol, LaScala never had the necessary written approvals from either Customer A or Aegis before engaging in trading in Customer A’s retirement account. Still, he made 139 trades during a 16-month timeframe, amounting to a principal value of about $2,000,000.00. While LaScala did have general discussions with Customer A regarding his short-term trading approach, he failed to communicate with the customer about the particulars of each trade on the days they were executed. Consequently, LaScala violated FINRA Rule 2010 and NASD Rule 2510(b).
Lascala was associated with Aegis Capital Corp. as a stockbroker since February 29, 2012, and as an investment advisor representative from January 14, 2014, to April 8, 2022.
