Joseph Augustien Lianzo of Melville New York a stockbroker formerly registered with Laidlaw Company (UK) Ltd. has been suspended for eight months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity founded on findings that Lianzo made excessive and unauthorized trades in customers’ accounts when he was associated with Laidlaw Company. Letter of Acceptance Waiver and Consent No. 2018058278601 (Aug. 31, 2021).
According to the AWC, between March of 2016 and November of 2019, unsuitable trades were made by Lianzo in the account of a customer of Laidlaw and in accounts of three SW Financial customers.
The regulator mentioned that customers received their recommendations from Lianzo and had often allowed for his trading. FINRA indicated that Lianzo controlled the customers’ accounts for this reason. But this caused those accounts to suffer high cost-to-equity ratios and high-turnover rates. Customers experienced substantial losses.
The AWC stated that from March of 2016 to March of 2017, the Laidlaw customer’s account contained an annualized cost-to-equity ratio of 145 percent and an annualized turnover rate of 35. The customer paid commissions of $15,169.00 but experienced $42,487.00 in losses.
From October of 2017 to November of 2019, quantitatively unsuitable trades were made by Lianzo in the accounts of SW Financial customers. The first customer’s account contained an annualized cost-to-equity ratio of 65 percent and an annualized turnover rate of 15. The commissions amounted to $22,975.00 for these trades. The customer’s account sustained $95,570.00 in losses.
The second SW Financial customer’s account contained an annualized cost-to-equity ratio of 78 percent and an annualized turnover rate of 18. The customer paid commissions of $51,781.00 and experienced $112,173.00 in losses. The third customer’s account had an annualized cost-to-equity ratio of 72 percent and an annualized turnover rate of 15. The customer experienced $43,078.00 in losses after paying commissions of $37,581.00.
FINRA determined that the customers’ investment profiles did not support Lianzo’s trading. He violated FINRA Rules 2010 and 2111 for unsuitable and excessive trading.
The AWC also stated that Lianzo made unauthorized trades at Laidlaw and SW Financial. The regulator shows that from February 14, 2017 to March 16, 2017, seven trades were made by Lianzo without the Laidlaw customer’s permission. Lianzo’s six unauthorized trades in the SW Financial customer’s account occurred from August 9, 2018 to October 31, 2018. He violated FINRA Rule 2010 for unauthorized trading.
Lianzo has been identified in two customer initiated investment related disputes regarding allegations of his wrongdoing at securities broker dealers. FINRA Public Disclosure shows that a customer initiated investment related FINRA securities arbitration claim regarding Lianzo’s conduct was resolved for $100,000.00 in damages based upon accusations that Lianzo made misrepresentations and provided unsuitable recommendations to the customer as it pertained to over-the-counter equities for their JP Turner Company account. According to the claim, the customer’s instructions were not followed. Lianzo allegedly made unsuitable trades and engaged in churning. Allegations also include breach of contract and fraud.
On June 26, 2019, a different customer initiated investment related FINRA securities arbitration claim involving Lianzo’s activities was settled for $14,999.00 based on accusations that negligence resulted in the customer’s damages on stock trades at Salomon Whitney Financial. FINRA Arbitration No. 18-01055 (June 26, 2019). The claim alleges unauthorized and unsuitable trading by Lianzo. The customer’s contract with the securities broker dealer had allegedly been breached. According to the claim, their account was also churned.
Lianzo was registered with Laidlaw Company between September 11, 2015 and April 26, 2017. Between March 30, 2017 and October 5, 2017, he was associated with Arive Capital Markets. Since September 21, 2017, he has been registered with SW Financial.