Broker misconduct results in “substantial harm’ to elderly customers
Philip Leonard Grasso Jr.’s 18-year career in the securities industry is now over due to allegations of elder fraud, where he purportedly misused funds, willfully misrepresented material facts and failed to complete on-the-record testimony requested by FINRA.
According to the FINRA Disciplinary Action, Philip Grasso has been permanently barred from association with any FINRA member in any capacity as of May 2015. There are three causes of action included in the findings.
In the first cause of action against Grasso, it is alleged that in the case of an 89-year old customer and a 91-year old customer respectively, Grasso misused and converted customer funds by depositing $227,150 of their money to his personal bank account for his own benefit, such as paying his mortgage, credit cards, and grocery bills. At Grasso’s recommendation, the customers had liquidated these funds believing Grasso was purchasing stocks on their behalf. To conceal his actions, Grasso then provided the customers with fabricated account statements, leading them to believe their funds were invested in stocks, and causing them “substantial harm.”
The second cause of action alleges the Grasso engaged in securities fraud by misrepresenting material facts by telling his customers that the funds would be used to purchase securities, when instead Grasso used the funds for personal expenses.
The third cause of action alleges that Grasso failed to provide testimony requested by FINRA.
The growing retirement community has become a playground for unscrupulous investors as evidenced by the rising number of claims regarding elder financial fraud, breach of fiduciary duty and others laid against financial advisors handling funds for seniors. Most brokerage firms prohibit a financial advisor from being a trustee or beneficiary of a non-family member’s estate. However, financial advisors have tremendous influence over their elderly clients and improperly seek to serve multiple roles in the relationship.
Luckily, senior investors have the right to pursue their losses through securities arbitration. If you have been wronged by Philip Grasso or any other financial broker’s misconduct, contact the experienced securities arbitration attorneys at Silver Law Group. We’ll review your case at no cost. We also work on a contingent fee basis, which means you will not pay legal fees unless we win your case.