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Investor Alleges Frank Avallone Committed Fraud

Oct 31, 2022 Unsuitable Investments

Frank Avallone (CRD #: 4814368), a broker registered with Ceros Financial Services, is involved in a pending dispute, according to his BrokerCheck record, accessed on October 16, 2022. Read on if you have questions about his conduct as a broker.

Investor Dispute

On July 5, 2022, an investor named Frank Avallone in a dispute alleging fraud, violation of FINRA Rules 2111 and 2210, failure to supervise, and breach of contract. This dispute is pending.

FINRA Rule 2111

FINRA Rule 2111 requires brokers to consider whether an investment suits their investor’s financial goals. Brokers must take into account the characteristics described in an investor’s profile, such as their age, risk tolerance, and other investments.

Securities may be unsuitable for an investor because they are high-risk and more likely to lose money. They may also be suitable due to a lack of liquidity, meaning they are intended to be held for a long period of time.

Trading activity can be quantitatively unsuitable. When a broker executes an excessive number of trades, the fees and commissions can eat into the investor’s returns severely.

This rule also applies to investment strategies. An example of a potentially unsuitable investment strategy is overconcentration, which can expose an investor to a degree of risk that is inappropriate given their profile.

Investors who rely on their broker for recommendations may be able to recover their losses through FINRA arbitration.

FINRA Rule 2210

FINRA Rule 2210 defines how firms and brokers can communicate with the public. Among other things, it requires firms to review communications to ensure they do not contain false, misleading, or promissory statements.

FINRA Rule 3110

Failure to supervise violates FINRA Rule 3110, which requires that firms establish systems of supervision to ensure their compliance with securities regulations. Firms must appoint supervisory personnel with sufficient training or experience and create Written Supervisory Procedures (WSPs) to guide their work

Background Information

Frank Avallone has passed the following exams:

  • Series 63 – Uniform Securities Agent State Law Examination
  • SIE – Securities Industry Essentials Examination
  • Series 7 – General Securities Representative Examination

Frank Avallone is a registered broker in 40 states and the District of Columbia.

He has also worked for the following firms:

  • National Securities Corporation (CRD#:7569)
  • Newbridge Securities Corporation (CRD#:104065)
  • Global Arena Capital Corporation (CRD#:16871)
  • First Midwest Securities (CRD#:21786)
  • Maxim Group (CRD#:120708)
  • Eastbrook Capital Group (CRD#:39781)

Kurta Law Can Help

If you worked with Frank Avallone and you have concerns about your investments, please contact us today at 877-600-0098 or info@kurtalawfirm.com for a free consultation.

For over 20 years, Kurta Law has advocated on behalf of investors who want 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.