Russell Rabito Facing New Options Overlay Dispute

Russell Rabito (CRD #: 845812), a broker registered with UBS Financial Services, is the subject of an investor dispute alleging he violated FINRA rules. This disclosure appears on his BrokerCheck record, accessed on September 25, 2023. Investors should know that this is not the only investor dispute on his record. 

On July 15, 2023, investors alleged that Russell Rabito violated suitability rules when he recommended an options overlay strategy. The investor further alleges misrepresentation. 

On September 24, 2019, an investor alleged that Russell Rabito recommended an unsuitable options overlay strategy. They further alleged misrepresentation. The investor sought $750,000 and the dispute settled for $250,000. 

FINRA Rule 2111 – The Suitability Rule

FINRA Rule 2111 requires brokers to evaluate whether an investment fits their investor’s financial goals.

Some common violations of this rule include:

• Excessive trading, which violates the need for quantitative suitability. This means that the number of trades must suit an investor’s goals.
• Recommendations of unsuitable investment strategies. For instance, overconcentration of securities in a certain stock or sector is typically unsuitable due to the degree of risk.
• Recommendations of high-risk or illiquid investments. These investments may lead to high fees for the investor.

Investors who rely on brokers for recommendations may be able to recover their losses by pursuing FINRA arbitration.

FINRA Rule 2020 – Misrepresentation

FINRA Rule 2020 prohibits the misrepresentation of investments or omission of material facts. Material facts include information about an investment’s potential returns, as well as charges, expenses, and fees. Brokers must always disclose the risks associated with illiquid investments, such as early withdrawal fees. 

Background Information 

Russell Rabito has passed the following exams:

• Series 66 Uniform Combined State Law Examination 
• Series 65 Uniform Investment Adviser Law Examination 
• Series 63 Uniform Securities Agent State Law Examination 
• SIE – Securities Industry Essentials Examination 
• Series 31 Futures Managed Funds Examination 
• Series 5 Interest Rate Options Examination 
• Series 7 General Securities Representative Examination
• Series 10 General Securities Sales Supervisor – General Module Examination 
• Series 9 General Securities Sales Supervisor – Options Module Examination 
• Series 8 General Securities Sales Supervisor – (Options Module & General Module) 

He is a registered broker in 38 states and D.C. He is also a registered investment adviser in Connecticut, New York, and Texas. 

Russell Rabito has registered with six firms during his 45 years of experience: 

• UBS Financial Services (CRD #: 8174) 
• Oppenheimer & Co. (CRD #: 630) 
• L.F. Rothschild, Unterberg, Towbin (CRD #: 501) 
• E.F. Hutton & Company (CRD #: 235) 
• Merrill Lynch, Pierce, Fenner & Smith Incorporated (CRD #: 7691) 
• Merrill Lynch, Pierce, Fenner & Smith (CRD #: 572) 

Kurta Law Can Help

If you worked with Russell Rabito 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.