FINRA has suspended Cadaret, Grant & Co., Inc. broker Paul Spero from the securities industry for 15 business days for exercising discretion without written authorization in approximately 70 customer accounts. The suspension is scheduled to start on May 17, 2021, and end on June 7, 2021.
Spero was also fined $5,000.
If you have lost money with Paul Spero, or Cadaret, Grant & Co., Inc., contact FINRA arbitration lawyers Iorio Altamirano LLP for a free and confidential evaluation of your account.
Iorio Altamirano LLP represents investors who have disputes with their financial advisors or brokerage firms, such as Cadaret Grant.
FINRA Letter of Acceptance, Waiver, and Consent (“AWC”)
Paul Spero and FINRA entered into a Letter of Acceptance, Waiver, and Consent (“AWC”) on April 26, 2021, over the following findings:
- Between August 2017 and August 2018, Spero exercised discretion without written authorization in approximately 70 customer accounts, in violation of NASD Rule 2510(b) and FINRA Rule 2010.
Discretionary Trading Without Prior Written Authorization
NASD Rule 2510(b) prohibits registered representatives from exercising any discretionary power in a customer’s account unless the customer has provided prior written authorization to the representative and the account has been accepted as a discretionary account by the representative’s firm in writing. A violation of NASD Rule 2510(b) is also a violation of FINRA Rule 2010.
FINRA Rule 2010 requires member firms and associated persons to observe high standards of commercial honor and just and equitable principles of trade in the conduct of their business.
FINRA conducted an examination of Cadaret Grant covering the period between August 2017 and August 2018. During that period, on January 18, 2018, and July 9, 2018, Spero effected approximately 105 discretionary trades in approximately 70 customer accounts. The customers knew that Spero was exercising discretion in their accounts, however, he did not have prior written authorization to do so from any of the customers. Additionally, Cadaret Grant had not approved any of the accounts for discretionary trading.
A broker who engages in discretionary trading without proper authorization runs afoul of unauthorized trading rules.
Cadaret, Grant & Co., Inc. – A Duty to Supervise
Financial institutions like Cadaret Grant must properly supervise financial advisors and customer accounts. Brokerage firms must establish and maintain a reasonably designed system to oversee account activity 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.
Paul Spero (CRD#: 1637713)
Spero entered the securities industry in 1987. He has 34 years of experience and has been registered as a broker with Cadaret, Grant & Co., Inc. in Liverpool, NY, since October 1989.
How to Recover Losses or Obtain a Free Consultation
If you have lost money with Paul Spero, or Cadaret, Grant & Co., Inc., contact FINRA arbitration lawyers August Iorio and Jorge Altamirano of Iorio Altamirano LLP at august@ia-law.com, jorge@ia-law.com or toll-free at (855) 430-4010 for a free and confidential evaluation of your account.
Iorio Altamirano LLP is a securities arbitration law firm based in New York, NY. We pursue FINRA arbitration claims nationwide on behalf of investors to recover financial losses arising out of wrongful conduct by financial advisors and brokerage firms.