Trevor Bradner Rahn of Los Angeles California a stockbroker formerly registered with JP Morgan Securities LLC has been fined $10,000.00 and suspended for 18 months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity founded on findings that Rahn made unsuitable recommendations and unauthorized trades when he was associated with JP Morgan Securities. Letter of Acceptance Waiver and Consent No. 2018059251701 (Mar. 19, 2021).
According to the AWC, between January of 2014 and September of 2018, an average pricing investment strategy had been recommended to customers by Rahn. This strategy affected 32 accounts at JP Morgan Securities and involved Rahn making a high number of small trades through a trading day. Rahn received more in commissions by effecting smaller trades, and his commissions exceeded the amounts that were set in place under JP Morgan’s commission schedule.
The stockbroker neglected to undertake the required due diligence to grasp how costs affected his recommended average pricing trading strategy. This resulted in Rahn making unsuitable investment recommendations to customers in violation of FINRA Rules 2010 and 2111(a).
FINRA also pointed out that as part of the average pricing trading strategy, Rahn exercised time and price discretion. He turned 1,106 customer orders into more than 7,500 trades. There was no point prior to those transactions that Rahn obtained written permission from customers for purposes of his discretionary trading. Rahn’s discretionary trading was also not authorized by JP Morgan Securities. When these trades were placed, Rahn neglected to identify that he engaged in time and price discretion. Rahn violated FINRA Rules 2010 and National Association of Securities Dealers (NASD) Rule 2510(b). The regulator also indicated that he made 577 unauthorized trades between June of 2016 and September of 2017 in violation of FINRA Rule 2010.
The AWC also confirmed that trades were marked by Rahn as unsolicited when the trades were actually solicited. 4,714 trades had been mismarked by the stockbroker in violation of FINRA Rules 2010 and 4511.
FINRA Public Disclosure reveals that Rahn has been identified in five customer initiated investment related disputes regarding allegations of his wrongdoing while associated with JP Morgan Securities. On November 20, 2017, a customer initiated investment related complaint regarding Rahn’s activities was settled for $57,847.00 in damages founded on accusations that the customers’ estate representative was not provided important information regarding the fees for liquidating stock from the customer’s JP Morgan Securities account. The complaint also alleges excessive fees.
On June 13, 2018, another customer initiated investment related complaint concerning Rahn’s conduct was resolved for $64,590.00 in damages supported by allegations that unauthorized transactions were executed in the customer’s account between August of 2017 and September of 2017. Rahn is also the subject of a customer initiated investment related written complaint which was settled for $114,000.00 in damages on February 28, 2019 based upon accusations of unauthorized trading by the stockbroker from March of 2014 to September of 2017 as it related to closed end funds, real estate investment trusts and over-the-counter equities.
On October 24, 2019, another customer initiated investment related complaint involving Rahn’s conduct was settled for $549,184.00 in damages founded on allegations that Rahn frequently traded which resulted in losses for the customer’s JP Morgan Securities account. The complaint also alleges that the stockbroker caused the customer to use margin so that it could generate commissions. According to the complaint, unauthorized stock trades were effected in the customer’s account.
Rahn is also referenced in a customer initiated investment related written complaint on April 1, 2020 in which the customer requested $125,000.00 in damages supported by accusations that private placements were sold to the customer through private securities transactions in which Rahn participated.
On September 17, 2018, Rahn was discharged by JP Morgan based upon allegations of trades being executed in customer accounts by Rahn in violation of JP Morgan’s business practices. The securities broker dealer also alleged that the stockbroker mismarked order tickets and had caused unwarranted charges.
