Jovannie Aquino (also known as John Aquino) a stockbroker formerly registered with Meyers Associates LP (also known as Windsor Street Capital LP) has been barred by Securities and Exchange Commission (SEC) from being a securities broker or investment advisor or otherwise associating with any securities broker dealers or investment advisories according to an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 based on allegations of Aquino committing securities fraud. In the Matter of Jovannie Aquino Administrative Proceeding File No. 3-19199 (June 13, 2019).
According to the Order, SEC’s decision to bar Aquino was founded on Aquino being enjoined from committing fraudulent activities in violation of Securities Exchange Act of 1934 Section 10(b), SEC Rule 10b-5, and Securities Act of 1933 Section 17(a). SEC v. Jovannie Aquino Civil Action No. 18-CV-8191 (S.D.N.Y. May 17, 2019).
In the Complaint filed against Aquino by SEC on September 17, 2018, SEC claimed that a fraudulent scheme was perpetrated by Aquino between December of 2015 and November of 2017, causing customers more than $881,000 in losses. Supposedly, Aquino executed trades in customers’ accounts on an excessive basis. Allegedly, he was primarily driven towards generating commissions or fees from the customers regardless of how badly this would affect them. SEC stated that seven customers of Meyers Associates had been steered by Aquino towards holding their investment accounts with him because of Aquino making promissory remarks about a profitable trading strategy he would implement for them.
Allegedly, a high volume of short-term trades had been recommended to customers by Aquino as part of his investment strategy. Each time that the trades were placed, Aquino generated additional commissions from the customers. According to SEC, Aquino traded so frequently and charged customers such inordinate commissions that he put customers in a position where they would have needed to generate an extraordinary rate of return to avoid incurring losses. Customers would have needed to generate returns ranging from approximately twenty-one percent to more than four hundred percent to offset the costs of transactions effected as part of Aquino’s trading strategy.
SEC alleged that Aquino did not have an adequate foundation to conclude that the trades he frequently made were appropriate given the high transaction costs. SEC determined that a total of six customers were provided bad advice by Aquino; his strategy was seemingly unsuitable given the customers’ tolerance for risk, objectives for investing and financial needs. Moreover, the Complaint alleged that Aquino engaged in fraudulent activities by failing to disclose information to customers concerning the strategy he implemented in customer accounts, and by placing trades in the customers’ accounts without Aquino having procured customers’ approval. SEC contended that Aquino’s conduct was violative of Securities Exchange Act of 1934 Section 10(b), SEC Rule 10b-5, and Securities Act of 1933 Section 17(a).
Financial Industry Regulatory Authority (FINRA) Public Disclosure confirms that Aquino has been identified in four customer initiated investment related disputes containing accusations of Aquino’s violative conduct while employed with securities broker dealers including Windsor Street Capital L.P., John Thomas Financial and Rockwell Global LLC. In particular, on June 5, 2017, a customer filed an investment related complaint regarding Aquino’s conduct where the customer requested unspecified damages based upon accusations that between January 1, 2017 and April 30, 2017, the customer’s account was churned; the customer was assessed excessive commissions on options and over-the-counter equities trades; margin was inappropriately utilized to effect securities transactions; the customer’s investment instructions were disregarded; and trades were placed in the customer’s account without the customer’s permission.
Thereafter, a customer filed an investment related civil action in the Pine County District Court that involved Aquino’s activities in which the customer sought $171,851.00 in damages supported by allegations of Aquino having executed inappropriate stock and over-the-counter equities transactions in the customer’s account causing the customer to sustain unwarranted investment losses. Civil Action No. 58-CV-18-327 (July 23, 2018).
Aquino’s registration with Windsor Street Capital LP ceased as of November 17, 2017. Between November 9, 2017 and September 11, 2018, Aquino was employed by Spartan Capital Securities. FINRA Public Disclosure reveals that Aquino has been associated with at least ten different broker dealers, including Windsor Street Capital LP, who have been expelled by securities regulators for violation of federal securities laws or who are otherwise defunct.
