Stockbrokers Can’t Trade in Dead Clients Accounts

Silver Law Group founder Scott Silver weighed in on the recent suspension of broke Luis E. Nin (CRD# 4372587) after he was discovered trading in a deceased client’s account.

In the article for Advisor Hub, Mr. Silver said, “This broker’s conduct violates the most fundamental foundational requirement that a broker owes a client—don’t buy a stock that the client has not authorized.” 

While registered with UBS Financial Services (CRD# 8174) of Newport Beach, CA, Nin was notified that the authorized person for a trust had died. Nin was the registered representative for this trust.

After learning of the person’s death, Nin placed ten trades in this trust account between June 29, 2022, and July 6, 2022. Although Nin spoke with a relative of the deceased about the trading, that relative did not have trading authority for the account. Later Nin wrongly told the firm that the customer had spoken to and received prior authorization from the now-deceased client. All customer-provided authorizations expire when the customer dies.

When the customer died, the account balance was $260,000. The ten trades were made to liquidate the account and prevent additional market losses for the decedent. Nin himself received $2,551.10 in commissions and sales credits from this trading.

Luis E. Nin violated FINRA Rule 2010, and has been given a one-month suspension, along with fines of $5,000 and disgorgement of the $2,551.10 in commissions and sales credits. FINRA issued a letter of Acceptance, Waiver & Consent (AWC) detailing the sanctions. Nin signed the letter on 8/13/2024, FINRA signed it on 8/14/2024, and the suspension went into effect immediately.

UBS Financial Services discharged Luis E. Nin on 1/13/2023 for the same reasons.

Nin’s previous employers included First Republic Securities Company, LLC (CRD# 105108) of New York, NY, and Chase Investment Services Corp. (CRD# 25574) of Chicago, IL. He has been in the industry since 2001.

FINRA Rule 2010

This rule addresses standards of honor and “just and equitable principles of trade.” It’s a “catch-all” rule that is used for a wide variety of infractions. Section 5320 specifically addresses trading ahead of a customer’s order. A fundamental rule is that a financial advisor must get clients permission before buying or selling securities.  Nothing highlights a violation of this rule than a stockbroker who continues to trade a client’s account even after the client has passed away.  FINRA arbitration claims on behalf of an estate often focus on improper conduct before the customer dies.  Our securities arbitration attorneys have seen a rise in claims involving various forms of elder abuse including unauthorized trading, improperly serving as a trustee or beneficiary of a client’s estate and other misconduct.  Broker-dealers are expected to implement best practices rules to detect and prevent this type of misconduct.

Did You Invest With Luis E. Nin?  

Silver Law Group represents investors in securities and investment fraud cases. Our lawyers are admitted to practice in New York and Florida and represent investors nationwide to help recover investment losses due to stockbroker misconduct. If you have any questions about how your account has been handled, call to speak with an experienced securities attorney. Most cases are handled on a contingent fee basis, meaning that you won’t owe us until we recover your money for you. Contact us today at (800) 975-4345 and let us know how we can help.