Adam Maggio is the Subject of a FINRA Fine and Suspension
Adam Maggio (CRD #: 4177365), a broker registered with VCS Venture Securities and Joseph Stone Capital, is the subject of a FINRA fine and suspension, according to his BrokerCheck record, accessed on February 19, 2021.
Churning Allegations
According to an Acceptance, Waiver, and Consent agreement dated December 10, 2021, Adam Maggio, while employed as a Joseph Stone Capital supervisor, allegedly failed to supervise trading in certain customer accounts for potential excessive trading activity.
What is Churning?
Churning is another term for excessive trading, which occurs when brokers execute trades simply for the sake of generating commissions for themselves, without any financial benefit for their investors. It is prohibited under FINRA Rule 2111, under “quantitative suitability.” This means that the number of trades, as well as the type of trades, must fit the customer’s needs.
According to the findings, Adam Maggio allegedly failed to review exception reports that flagged accounts with high commission-to-equity ratios. Instead, he tried to identify excessively traded accounts using his own manual calculations, which failed to identify red flags.
The findings further stated that even after Adam Maggio was provided notice of these red flags, he allegedly did not implement appropriate procedures to stop the misconduct.
What is FINRA’s Failure to Supervise Rule?
FINRA Rule 3110 requires that firms supervise their brokers and financial advisers. The firm must make reasonable efforts to determine that all supervisory personnel are qualified, either by experience or training.
Sanctions
As part of the terms of the AWC, Adam Maggio consented to:
- Five-month suspension
- $5,000 fine.
- 20 hours of continuing education concerning supervisory responsibilities.
You can read a copy of the AWC here.
Background Information
Adam Maggio has passed the following exams:
- Series 63 – Uniform Securities Agent State Law Examination
- SIE – Securities Industry Essentials Examination
- Series 7 – General Securities Representative Examination
- Series 53 – Municipal Securities Principal Examination
- Series 4 – Registered Options Principal Examination
- Series 24 – General Securities Principal Examination
He is a registered broker in nine states.
Adam Maggio has also worked with the following firms:
- First Midwest Securities (CRD#:21786)
- P. Turner & Company (CRD#:43177)
- Brundyn Securities (CRD#:124493)
- The Merchanthouse Securities (CRD#:7130)
- North American Clearing(CRD#:39118)
- KSH Investment Group (CRD#:41817)
Kurta Law Can Help
If you worked with Adam Maggio and you have concerns about your investments, please contact us today at 877-600-0098 or info@kurtalawfirm.com for a free consultation.
For nearly 20 years, Kurta Law has advocated for investors to recover their investment losses from brokers and brokerage firms. Kurta Law is a nationally recognized law firm and exclusively represents investors against brokers and brokerage firms on a contingency basis. This means that the firm only earns a fee if our securities attorneys recover money on your behalf.