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John Cody Named in Allegations of Fraud and Mismanagement

John Cody (CRD #: 49467), a broker registered with Merrill Lynch, Pierce, Fenner & Smith, allegedly mismanaged and defrauded a client, according to his BrokerCheck record, accessed on July 13, 2022. If you have questions about John Cody’s conduct as a broker, keep reading.

Investor Dispute

In a dispute filed on May 5, 2022, an investor alleged John Cody engaged in fraud and mismanagement, charged excessive fees, and violated suitability requirements. This dispute is currently pending.

FINRA Rule 2111

FINRA Rule 2111 – a.k.a the “suitability rule” – requires that brokers tailor their investment recommendations to an investor’s profile. An investor’s profile describes relevant information like their age, tax status, and investment goals.

High-risk securities are often unsuitable due to the probability of losses for the investor. Illiquid investments may also be unsuitable for investors with short-term goals because they are meant to be held for long periods and tend to incur high fees for investors who try to cash out early.

Investments can also be quantitatively unsuitable, which means that the broker engaged in excessive trading. Also known as churning, excessive trading generates commissions and fees that eat into investors’ returns.

Brokers must also recommend suitable investment strategies. A common unsuitable investment strategy is over-concentration, which comes with a level of risk that is too high for most investors’ overall financial goals.

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

Background Information

John Cody has passed the following exams:

  • Series 65 – Uniform Investment Adviser Law Examination
  • Series 63 – Uniform Securities Agent State Law Examination
  • SIE – Securities Industry Essentials Examination
  • Series 5 – Interest Rate Options Examination
  • PC – AMEX Put and Call Exam
  • Series 1 – Registered Representative Examination
  • Series 24 – General Securities Principal Examination
  • Series 4 – Registered Options Principal Examination

John Cody is a registered broker in 33 states, the District of Columbia, and the Virgin Islands. He is also a registered investment adviser in California and Texas.

He has also worked for Bateman Eichler, Hill Richards (CRD#:76) and Merrill Lynch, Pierce, Fenner & Smith (CRD#:572).

Kurta Law Can Help

If you worked with John Cody and you have concerns about your investments, please contact us today at 877-600-0098 or 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.