Securities Arbitration Lawyer Blog
The Financial Industry Regulatory Authority (“FINRA”) has suspended financial advisor Elias Hakimian from the securities industry for three months. Mr. Hakimian consented to the suspension after FINRA alleged that he borrowed $120,000 from a customer without notice to or obtaining written pre-approval from his employing brokerage firm, LPL Financial LLC, in violation of FINRA Rules 3240 and 2010. FINRA also fined Mr. Hakimian $5,000.
LPL Financial LLC allowed Mr. Hakimian to “voluntarily resign” after a customer alleged that he engaged in churning in the customer’s accounts and invested the customer’s funds in speculative ventures contrary to the customer’s objectives and risk tolerance, in addition to taking loans from the customer.
Excessive trading occurs when a financial advisor makes many trades in a customer’s account, not to benefit the customer but to generate commissions for the broker.
Churning is a more egregious variation of excessive trading. Churning refers to a situation where the broker executed an excessive number of trades and did so with the intent to defraud or reckless disregard for the customer’s interest. Churning is an unethical and illegal practice. It is also a violation of securities rules and regulations and can cause enormous harm to customers.
If you have suffered financial losses investing with Elias Hakimian, or suspect that Mr. Hakimian did not have your best interest in mind when recommending investments or making account transactions, contact New York securities arbitration law firm Iorio Altamirano LLP for a free and confidential review of your account or annuity contract.
Iorio Altamirano LLP represents investors that have disputes with their financial advisors or brokerage firms, such as LPL Financial LLC.
FINRA Letter of Acceptance, Waiver, and Consent No. 2019062902601
FINRA and Mr. Hakimian entered into a Letter of Acceptance, Waiver, and Consent No. 2019062902601 on April 21 2021, after FINRA alleged that in March 2011, Mr. Hakimian borrowed 120,000 from a customer without notice to or obtaining written pre-approval from LPL Financial LLC. Specifically, FINRA alleged:
- In March 2011, Mr. Hakimian borrowed $120,000 from an LPL customer with whom he had a close friendship.
- Hakimian signed a loan agreement and agreed to pay 10 percent interest per year, with the note to be repaid within two years.
- The loan was then extended and restructured several times.
- In 2019, Mr. Hakimian fully repaid the loan.
- LPL’s policies prohibited its registered representatives from borrowing money from customers except in certain limited circumstances, none of which applied to the loan Mr. Hakimian received from the customer.
- The firm’s policies also required its registered representatives to receive approval prior to borrowing money from customers.
- At no time did Mr. Hakimian seek or receive approval from LPL to enter into the loan agreement.
- In addition, in eight separate annual compliance questionnaires from 2011 to 2018, Mr. Hakimian falsely represented that he had not borrowed money from another individual or entity.
- The firm only learned of the loan after the customer complained.
- Hakimian violated FINRA Rules 3240 and 2010.
Financial Advisor Elias Moses Hakimian (CRD No. 4404048)
Elias Moses Lopez-Hakimian has 17 years of experience in the securities industry and was associated with LPL Financial LLC in Seal Beach, CA, from October 2005 to June 2019.
Mr. Hakimian also conduced business through an entity named Crystal Cove Advisors.
In April 2019, a customer filed a securities arbitration complaint against Mr. Hakimian and LPL Financial LLC. The customer alleged that between 2010 and 2017, Mr. Hakimian engaged in churning of the customer’s accounts and also invested the customer’s funds in speculative ventures. The customer also alleged that Mr. Hakimian borrowed money from customers. LPL Financial LLC and Mr. Hakimian settled the dispute for $275,000.
LPL Financial LLC – A Duty to Supervise
Financial institutions like LPL Financial LLC must properly supervise financial advisors and customer accounts. Brokerage firms must establish and maintain a reasonably designed system to oversee account activity, such as churning, to ensure compliance with securities laws and industry regulations. When a brokerage firm fails to supervise its financial advisors or the investment account activity sufficiently, it may be liable for investment losses sustained by customers.
How to Recover Financial Losses or Obtain a Free Consultation
If you have suffered investment losses with Elias Hakimian or LPL Financial LLC or suspect other inappropriate activity occurred in your investment or retirement account, contact New York securities arbitration attorney August Iorio of Iorio Altamirano LLP. August Iorio can be reached at august@ia-law.com or toll-free at (855) 430-4010 for a free and confidential review of your legal rights.
Iorio Altamirano LLP is a securities arbitration law firm based in New York, NY. Iorio Altamirano LLP pursues FINRA claims nationwide on behalf of investors to recover financial losses arising out of wrongful conduct by stockbrokers and brokerage firms.
Iorio Altamirano LLP is a bilingual law firm, fluent in both English and Spanish.