Michael Puma Allegedly Engaged in Fraud and Negligence

Michael Puma (CRD #: 2460247), a previously registered broker with Oppenheimer & Co., is the subject of an investor dispute. This disclosure appears on his BrokerCheck record, accessed on September 22, 2023. Investors should know this is the third investor dispute on his record. 

On July 17, 2023, investors alleged that Michael Puma engaged in fraud, negligence, and breach of contract. They further alleged unsuitability and churning with his use of margin and trading in their accounts. 

FINRA Rule 2111 – Excessive Trading 

FINRA Rule 2111, a.k.a. The Suitability Rule, requires brokers to tailor their investment recommendations to suit investors’ needs. Trades must be quantitatively suitable, meaning the number of trades must be suitable. Each trade comes with a transaction fee, so too many transactions will result in excessive fees for the investor. Excessive trading is also known as “churning.” 

What is Margin Investing? 

Investing on margin is when an investor opens a margin account and borrows 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 to cover the minimum. 

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

FINRA Rule 2010

FINRA Rule 2010 holds brokers to high standards of commercial honor and just and equitable principles of trade. Fraud and breach of contract would violate this rule. 

Background Information 

Michael Puma has passed the following exams: 

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

Michael Puma has registered with four firms in his 28 years of experience: 

• Oppenheimer (CRD #: 249) 
• Josephthal & Co. (CRD #: 3227) 
• Barington Capital Group (CRD #: 29383) 
• D.H. Blair & Co. (CRD #: 6833) 

Kurta Law Can Help

If you worked with Michael Puma 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.