The Financial Industry Regulatory Authority (“FINRA”) has suspended financial advisor Mark Larry Delgadillo from the securities industry for one month. Mr. Delgadillo consented to the suspension after FINRA alleged that he engaged in discretionary trading without written authorization for 16 customers between August 1, 2019, and October 31, 2019, executing approximately 100 transactions. FINRA also fined Mr. Delgadillo $5,000.
The alleged conduct occurred while Mr. Delgadillo was employed by D.A. Davidson & Co. in Santa Barbara, California. D.A. Davidson & Co. allowed Mr. Delgadillo to voluntarily resign in April 2020 after discovering that he was making trades without first contacting clients.
If you have suffered financial losses investing with Mark Delgadillo, or suspect that Mr. Delgadillo 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 D.A. Davidson & Co.
FINRA Letter of Acceptance, Waiver, and Consent No. 2020065936301
FINRA and Mr. Delgadillo entered into a Letter of Acceptance, Waiver, and Consent No. 2020065936301 on March 23, 2021, after FINRA alleged that Mr. Delgadillo engaged in discretionary trading without written authorization for 16 customers between August 1, 2019, and October 31, 2019, executing approximately 100 transactions. Specifically, FINRA alleged:
- D.A. Davidson & Co. Written Supervisory Procedures (WSPs) prohibited its brokers from exercising discretionary power in customer accounts except in limited circumstances.
- Between August 1, 2019, and October 31, 2019, Mr. Delgadillo exercised discretionary power in the accounts of 16 customers on at least 100 occasions under circumstances that did not qualify for an exception described in the firm’s WSPs.
- Delgadillo failed to obtain prior written authorization from the 16 customers to exercise discretionary power in their accounts.
- Delgadillo also never obtained D.A. Davidson & Co.’s approval to exercise discretionary power in the 16 customers’ accounts.
- As a result of the foregoing conduct, Delgadillo violated FINRA Rules 3260(b) and 2010.
Unauthorized trading often occurs in non-discretionary accounts, where a customer retains discretion. In non-discretionary accounts, brokers must obtain a customer’s permission every time before placing a trade.
Unauthorized trading is an unethical and illegal practice. It is also a violation of securities rules and regulations and can cause enormous harm to customers.
Financial Advisor Mark Larry Delgadillo (CRD No. 1436842)
Mark Delgadillo has 34 years of experience in the securities industry and has been associated with the following firms:
- A. Davidson & Co. in Santa Barbara, CA, from November 2013 to May 2020.
- Crowell Weedon & Co. in Santa Barbara, CA, from August 2010 to November 2013.
- Morgan Stanley Smith Barney in Santa Barbara, CA, from June 2009 to August 2010.
- Citigroup Global Markets Inc. in Santa Barbara, CA, from April 2005 to June 2009.
- Morgan Stanley Smith Barney in Purchase, NY, from April 1986 to April 2005.
- Pruco Securities Corporation from April 1986 to April 1976.
Mr. Delgadillo is currently not registered with any firm.
According to his public disclosure report with FINRA, Mr. Delgadillo has been the subject of at least two customer disputes:
- Customer Dispute (October 2010): Customers filed a securities arbitration complaint, alleging over $207,000 in damages. The customers alleged that Mr. Delgadillo failed to inform them of the tax consequences of forfeiting their minimum death benefit annuity, which resulted in an early surrender of the annuity. The customer also alleged that Mr. Delgadillo’s recommendations concerning a mutual fund were not suitable. The dispute was settled for $150,000 by Citigroup Global Markets Inc., the firm that employed Mr. Delgadillo at the time.
- Customer Dispute (September 2004): A customer filed a complaint with Morgan Stanley Smith Barney, alleging that certain municipal debt investments recommended by Mr. Delgadillo were not suitable. Morgan Stanley paid $5,000 to settle the dispute with the customer.
D.A. Davidson & Co. – A Duty to Supervise
Financial institutions like D.A. Davidson & Co. must properly supervise financial advisors and customer accounts. Brokerage firms must establish and maintain a reasonably designed system to oversee account activity, such as annuity switches, 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 Mark Delgadillo or D.A. Davidson & Co, 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.