Gary Costello Barred by FINRA for Alleged Refusal to Provide Testimony

Gary Costello (CRD #: 6117388), a broker formerly registered Aegis Capital Corporation, has been barred by FINRA, according to his BrokerCheck record, accessed on April 11, 2025. Keep reading to learn more about his alleged conduct as a broker.

Bar by FINRA

On February 4, 2025, Gary Costello consented to the entry of findings that he allegedly refused to appear for on-the-record testimony requested by FINRA.

According to a Letter of Acceptance, Waiver & Consent (AWC), FINRA allegedly requested his testimony as part of an investigation into allegations that he placed trades in his personal accounts, then cancelled and rebilled them to client accounts. This allegedly caused these clients to incur losses for trades they had not placed.

The AWC concluded that the alleged refusal to provide testimony constituted a violation of FINRA Rules 8210 and 2010.

FINRA Rule 8210

FINRA Rule 8210 requires members to provide documents, information, and testimony upon request by FINRA.

FINRA Rule 2010

FINRA Rule 2010 holds brokers to high standards of commercial honor and just and equitable principles of trade.

Sanctions

FINRA permanently barred Gary Costello on February 4, 2025. You can read the AWC here.

Resignation from Aegis Capital Corporation

On March 15, 2024, Gary Costello was permitted to resign from Aegis Capital Corporation following allegations related to customer complaints at a prior firm.

Investor Disputes

Six disputes filed in 2023 and 2024 alleged that Gary Costello executed unauthorized trades in client accounts. These disputes were settled for a total of $2,440,563.28.

On December 20, 2023, multiple investors filed a dispute alleging that Gary Costello executed unauthorized and unsuitable trades and overconcentrated them in certain investments. Investors received a settlement of $105,000.

In a dispute filed on September 25, 2023, several investors named Gary Costello in allegations of breach of contract, negligence, churning, unauthorized withdrawals, fraud, and violation of state securities laws from July 2019 to December 2022. The clients sought $2,103,426 in damages and received a settlement of $1.2 million.

FINRA Rule 3260

FINRA Rule 3260 forbids brokers from conducting discretionary trading outside of accounts approved in advance by their client and firm.

FINRA Rule 2111

FINRA Rule 2111 requires that brokers tailor their investment recommendations to an investor’s profile, which describes their investing experience, risk tolerance, tax status, age, and other characteristics.

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

Termination from Truist Investment Services

On August 14, 2023, Truist Investment Services fired Gary Costello following allegations that he cancelled trades placed in his personal accounts and rebilled those trades to client accounts, leading to these clients incurring losses on the trades. The firm allegedly also investigated his use of margin in his own and clients’ accounts.

What is Margin Investing? 

Investing on margin involves borrowing money from a brokerage firm in order to purchase more securities. Using borrowed money is called “leverage” and it increases the risk that the investor will lose money. Margin accounts may come with interest charges, significant broker fees, and the risk of a margin call. 

Margin calls happen when the broker needs more money in the account in order to cover the minimum margin requirement. If the investor does not deposit money in the margin account, the broker may liquidate securities in the investor’s account in order to cover the minimum. 

Utilizing margin is often unsuitable and investors should be made aware of the risks before purchasing securities on margin. 

Background Information 

Gary Costello has passed the following exams: 

• Series 66 – Uniform Combined State Law Examination 
• SIE – Securities Industry Essentials Examination 
• Series 7 General Securities Representative Examination 
• Series 6 Investment Company Products / Variable Contracts Representative Examination 

Gary Costello has registered with the following firms: 

• Aegis Capital Corporation (CRD#:15007)
• Truist Investment Services (CRD #: 17499) 
• Oppenheimer & Co. (CRD #: 249) 
• Morgan Stanley (CRD #: 149777) 
• Park Avenue Securities (CRD #: 46173) 

Kurta Law Can Help

If you worked with Gary Costello and 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 that 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.