Ken Kavanaugh’s publicly-available FINRA BrokerCheck report lists 3 disclosures, including 1 customer dispute, 1 employment separation after allegations, and 1 regulatory action.
Ken Kavanagh BrokerCheck Disclosures
The first disclosure on Kavanagh’s record comes in April, 2018, which is an ‘Employment Separation After Allegations’ disclosure. After allegations “regarding the representative’s involvement in the provision of services to clients outside the scope of the firm’s services”, Kavanagh voluntarily resigned from Morgan Stanley Wealth Management.
Customer Disputes
An August, 2018 customer dispute states that the client’s attorney “did not authorize transactions in the client’s account, and that the signature on documents which purportedly authorized such transactions were not his. 2010-2018”. The damages requested in that dispute were $186,000, but it was withdrawn.
Suspension For Outside Business Activity
In August, 2018, Kavanagh consented to sanctions and findings that he “engaged in outside business activities without providing prior written notice to his member firm. The findings stated that Kavanagh managed the personal affairs of professional athletes, including over 40 professional athletes who were clients of both Kavanagh and the firm. Kavanagh received approximately $5 million in fees. Kavanagh also falsely attested on six firm questionnaires that he was not involved with any outside business activities.”
The sanctions amount was $25,000 and Kavanagh was suspended in all capacities for 18 months. The suspension ends in February, 2021.
Why Disclosing Outside Business Activity Is Important
Brokerage firms are required to monitor their registered representatives and be aware of their outside business activity. If they fail to oversee their registered representatives, they could face FINRA sanctions or client settlements pursuant to the “failure to supervise” rule.
Brokers have been known to conduct private securities transactions that have not been approved by the firm they are registered with, which is called selling away and can involve significant risk.
Though brokers may solicit outside investments, but the firms they work for are responsible for their activity and could still be responsible for paying clients settlements awarded through FINRA arbitration.
Did You Invest With Ken Kavanagh Or Morgan Stanley?
Silver Law Group has represented professional athletes, lottery winners, and others who quickly earned or received a large sum of money and were solicited by financial advisors to help manage the money. The receipt of a lump sum of money can be overwhelming and make someone a target of wealth advisors in claims for breach of fiduciary duty, negligence, and stockbroker misconduct.
If you have investment losses with Ken Kavanagh or Morgan Stanley, please contact Scott Silver of the Silver Law Group for a free consultation at ssilver@silverlaw.com or toll free at (800) 975-4345 to discuss options to recover your losses through FINRA arbitration.
Silver Law Group represents investors in securities and investment fraud cases, including tk. Our attorneys represent investors nationwide to help recover investment losses due to stockbroker misconduct. Most cases are handled on a contingent fee basis, meaning that you won’t owe us unless we recover money for you. Contact us today and let us know how we can help.