Dean Sadrudin Mustaphalli, of Forest Hills, New York, a stockbroker formerly registered with Sterne Agee Financial Services, Inc., has been named in a customer initiated investment related arbitration claim, which settled on December 1, 2015, for $400,000.00 in damages based upon allegations that Mustaphalli made misrepresentations to the customer concerning direct investment products, and effected an investment purchase in the customer’s account which was not suitable.
Mustaphalli was fined and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity according to a Decision & Order of Settlement containing findings that Mustaphalli engaged in unauthorized private securities transactions. Department of Enforcement v. Mustaphalli, No. 2013036880302 (Dec. 15, 2014). According to the Decision, a hedge fund had been created and managed by Mustaphalli, where he was compensated in connection with selling an estimated $6,000,000.00 worth of investments to customers. Apparently, Mustaphalli failed to inform Sterne Agee Financial Services regarding his involvement, and the firm never approved of his participation. FINRA found that Mustaphalli’s conduct was violative of FINRA Rules 2010 and 8210.
Financial Industry Regulatory Authority (FINRA) Public Disclosure reveals that Mustaphalli has been named in fifteen additional customer initiated investment related disputes containing allegations of Mustaphalli’s misconduct while employed with Sterne Agee Financial Services, Inc. and Citigroup Global Markets Inc. For example, on October 2, 2003, a customer initiated investment related civil action involving Mustaphalli’s conduct was settled for $6,403.33 in damages based upon allegations that Mustaphalli omitted mention of a contingent deferred sales charge on a variable annuity investment at the time that the customer purchased it.
Between January 14, 2010, and November 17, 2010, Mustaphalli was named in seven additional customer initiated investment related disputes pertaining to his conduct, in which the claims were settled for a total of $403,647.05 in damages based upon allegations which included misrepresentation; customers claimed that Mustaphalli informed investors that their principal investments were guaranteed and safe when the investments were exposed to principal risk.
Subsequently, on May 30, 2011, a customer initiated investment related written complaint involving Mustaphalli’s conduct was settled for $67,000.00 in damages based upon allegations that Mustaphalli misappropriated the customer’s funds. Between April 22, 2015, and April 28, 2015, two additional customer initiated investment related arbitration claims regarding Mustaphalli’s activities were resolved for a total of $335,000.00 in damages based upon allegations that Mustaphalli made misrepresentations to the customers and effected unsuitable direct participation program transactions in the customers’ accounts.
Guiliano Law Group
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