Mark Kaplan of Woodbury New York is a stockbroker formerly employed by Vanderbilt Securities, LLC who has been barred from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity supported by consenting to findings that he churned and excessively traded customers’ investment portfolios. Letter of Acceptance Waiver and Consent No. 2015045984001 (Mar. 7, 2018).
According to the AWC, a ninety-three-year-old customer, BP, established accounts with Kaplan through Vanderbilt Securities, LLC in March of 2011. Apparently, BP relied solely on social security throughout the period where he invested with Kaplan and maintained a balance of $507,544.64 in his investment account on March 31, 2011.
Evidently, between March of 2011 and March of 2015, BP’s accounts had been controlled by Kaplan, where BP depended on Kaplan to make decisions concerning BP’s investments. The AWC stated that in January of 2014, BP was diagnosed with dementia and by April of 2015, BP’s nephew became BP’s guardian, in which the nephew was responsible for managing BP’s finances.
The AWC stated that between March of 2011 and March of 2015, at least three thousand five hundred transactions had been placed by Kaplan in the accounts owned by BP, where Kaplan raked in commissions totaling $735,000.00 while BP sustained trading losses totaling $723,000.00. The AWC indicated that Kaplan failed to apprise BP about the commissions and sales charges that were assessed in his account and neglected to inform BP about his trading losses.
The AWC further stated that throughout this time, BP’s two accounts suffered from annual cost-to-equity ratios ranging from sixteen percent to as high as eight hundred fourteen percent. Additionally, the customer’s accounts suffered from annual turnover rates ranging from two percent to one hundred eighteen percent. FINRA concluded that Kaplans’ trading volume was unsuitable and excessive for BP in consideration of BP’s income needs, tolerance for risk and age. Consequently, FINRA found that Kaplan’s conduct was violative of Securities and Exchange Act of 1934 Section 10(b), Securities and Exchange Commission (SEC) Rule 10b-5, as well as FINRA Rules 2010, 2111 and 2020.
FINRA Public Disclosure reveals that Kaplan has been referenced in seven customer initiated investment related disputes containing allegations of his misconduct while employed with Vanderbilt Securities, LLC, Morgan Stanley and Citigroup GMI. Particularly, a customer initiated investment related arbitration claim concerning Kaplan’s conduct was settled for $470,000.00 in damages founded on accusations that Kaplan effected unauthorized options, stock and over-the-counter equities transactions in the customer’s account. FINRA Arbitration No. 15-01345 (Apr. 4, 2016).
Subsequently, a customer initiated investment related arbitration claim pertaining to Kaplan’s activities was resolved for $25,000.00 in damages based upon allegations that Kaplan made unsuitable investment recommendations to the customer concerning over-the-counter equities. FINRA Arbitration No. 15-03082 (May 17, 2016). Another customer initiated investment related arbitration claim regarding Kaplan’s conduct was resolved for $240,000.00 in damages supported by accusations of excessive trading and suitability relating to the customer’s equity portfolio transactions.
Moreover, a customer initiated investment related arbitration claim involving Kaplan’s conduct was settled for $500,000.00 in damages founded on allegations that Kaplan placed unsuitable real estate investment trust and master limited partnership transactions with the customer’s funds. FINRA Arbitration No. 16-00193 (June 6, 2017).
Kaplan’s registration with Vanderbilt securities, LLC was terminated on February 22, 2018.
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