Investigative Report:  Iorio Altamirano LLP Investigation into Arive Capital Markets Reveals Troubling Pasts for Owners, Executives, and Brokers

This post is the first in a series of investigative blog posts that spotlight modern-day boiler rooms that operate under the guise of a reputable brokerage firm.  Many of the broker-dealers featured in this series still use boiler room tactics such as cold-calling customers and high pressure or aggressive sales tactics.  Other brokerage firms have a propensity for broker misconduct, such as excessive trading, churning, unauthorized trades, and misrepresentation.  Iorio Altamirano LLP is a securities arbitration law firm based in New York City. We represent investors nationwide who have suffered investment losses due to wrongful conduct by financial advisors and brokerage firms.  We are investor advocates.

SUMMARY:

• In 2017, in collaboration with Columbia Law School, Reuters analyzed FINRA data and identified 48 firms whose brokers have been flagged for serious incidents. In 2021, our firm set out to update that analysis. 

• Arive Capital Markets was third on the Reuters list – and in the country – with 65.5% of its brokers having at least one of the most serious red flags on their public disclosure. 

• In 2021, eighty percent (80%) of registered representatives at Arive Capital Markets, which includes brokers and supervisors, have significant red flag disclosures on their BrokerCheck reports. Significant red flag disclosures include regulatory sanctions, terminations of employment after allegations of misconduct, customer disputes that result in an award or settlement, and prior association with a firm that FINRA has expelled. 

• More than half (56%) of the firm’s financial advisors and supervisors have previously been associated with a firm that FINRA has barred from the securities industry. 

• Fifty-two percent (52%) of Arive Capital Market’s brokers and supervisors have been accused of excessive trading, churning, or unauthorized trading. 

• Three of the firm’s top four (75%) executives have been the subject of regulatory sanctions; one executive has worked at six different brokerage firms that FINRA has shut down. 

• Three individuals who have an ownership stake in Arive Capital Markets have concerning backgrounds, including two regulatory actions that have resulted in suspensions.

BACKGROUND:  ARIVE CAPITAL MARKETS (CRD#: 8060 / SEC#: 8-43350)

Arive Capital Markets, LLC (“Arive Capital Markets) has been a FINRA member since 1980.  It has previously done business under Reid & Gilmour, Reid and Associates, and Reid and Associates, LLC.

The firm has approximately 25 registered individuals, five branch offices, and is headquartered in Brooklyn, New York.  The branch offices are believed to be in Brooklyn, NY, Staten Island, NY, Forest Hills, NY, Ronkonkoma, NY, and North Miami Beach, Florida.

According to the Financial Industry Regulatory Authority (“FINRA”), Arive Capital Markets provides wealth management services to retail customers, engaging primarily in equity transactions. Arive Capital Market’s website states that the firm is a “full-service brokerage” offering stocks, options, bonds, hybrids, funds, trusts, and insurance.  According to public disclosures, Arive Capital Markets offers its customers day trading and is a broker of public non-traded and exchange-traded Real Estate Investment Trusts (REITS).

ARIVE CAPITAL MARKETS:  DISCIPLINARY HISTORY

Arive Capital Markets and FINRA entered into a Letter of Acceptance, Waiver, and Consent (“AWC”) on March 26, 2020, after the firm failed to develop and implement an anti-money laundering program (“AMLCP”) reasonably designed to achieve and monitor the firm’s compliance with retirements of the Bank Secrecy Act and the implementing regulations thereunder.  Specifically, from October 27, 2015, through March 8, 2016, Arive Capital Markets failed to establish and implement policies and procedures that could be reasonably expected to detect and cause the reporting of potentially suspicious activity related to low-priced securities transactions.  Arive Capital Markets also failed to conduct annual independent testing (on a calendar-year basis) of its AMLCP in 2015 and 2016.

ARIVE CAPITAL MARKETS:  A HIGH CONCENTRATION OF BROKERS WITH RED FLAGS

The term “boiler room” often refers to an outbound call center that sells questionable investments through unfair, dishonest, and high-pressure sales tactics.

Historically, Long Island, New York has been a haven for boiler-room brokerage firms. This notoriety has inspired blockbuster movies such as “Boiler Room” and “The Wolf of Wall Street.”  The Wolf of Wall Street was based on the true story of broker Jordan Belfort and his firm, Stratton Oakmont. Jordan Belfort pleaded guilty to securities fraud and money laundering in 1999.

Many broker-dealers still use boiler room tactics such as cold-calling customers and high pressure or aggressive sales tactics.  Other modern-day boiler room brokerage firms have a propensity for broker misconduct, such as excessive trading, churning, and unauthorized trades.

In 2017, Reuters investigated and exposed 48 brokerage firms that tended to employ brokers with histories of misconduct sanctions, legal disputes, and financial distress.  Each of the 48 firms had more than 30 percent of its brokers with at least one significant red flag on their records.

FINRA requires brokers to publicly disclose 23 different incidents that the regulator believes could cause concern to investors.  The Reuters analysis only examined the 12 most serious incidents among the 23 that FINRA requires brokers to disclose, which included: (i) customer disputes regarding an investment-related complaint that resulted in a settlement or award/judgment; (ii) a final, formal proceeding initiated by a regulatory authority for a violation of investment-related rules or regulations; (iii) financial liens; (iv) criminal charges that resulted in a conviction or plea arrangement; and (v) employee separation after allegations. At the time, the 48 firms oversaw about 4,600 brokers and billions in investor funds.

In 2017, Arive Capital Markets was third on the list, and in the country, with 65.5% of its brokers having at least one of the most serious red flags on their public disclosure. At the time, that compared to 9% of brokers industry-wide who had at least one significant red flag on their record.  Reuters sought comment from Arive Capital Markets before publishing its 2017 findings, but the firm did not respond.

In January 2021, Iorio Altamirano LLP set out to update the Reuters 2017 analysis.  We found that 68% of Arive Capital Markets’ registered representatives had at least one of the most serious red flags on their public disclosure reports, increasing from 2017.

Although the Reuters’ analysis was comprehensive, it did not consider brokers’ past associations with firms that FINRA had expelled as one of its significant red flags.  That was an oversight.  A review of regulatory sanctions and registration histories of the firms and their brokers suggests the same players are involved from ownership to management to brokers.  In short, brokers and supervisors with significant disciplinary histories get shuffled around from one “boiler room” broker-dealer to another, taking their questionable sales and supervisory practices with them.

At Arive Capital Markets, fifty-six percent (56%) of its brokers had at some point in their careers worked at a firm that was later expelled by FINRA, with nearly a third of the brokers working at multiple firms that FINRA has expelled.

When you include this disclosure to the other 12 red flags used by Reuters in its 2017 analysis, eighty (80%) of brokers at Arive Capital Markets have significant red flag disclosures on their BrokerCheck reports.  That is, 80% of Arive Capital Market’s registered representatives, which includes its salesforce and management, have a history that includes at least one of the following:

• Customer disputes that resulted in settlements or judgments.
• Regulatory sanctions.
• Civil judgments.
• Personal bankruptcies.
• Employment terminations after allegations of misconduct.
• Prior association with a firm that FINRA has expelled.

Iorio Altamirano LLP’s investigation also revealed the following:

• Thirty-two percent (32%) of Arive Capital Markets’ brokers have regulatory sanctions on their public disclosures. A regulatory sanction is defined as a final, formal proceeding initiated by a regulatory authority to violate investment-related rules or regulations.
• Sixty percent (60%) of Arive Capital Markets’ brokers have a history of at least one customer dispute that has resulted in a monetary settlement, arbitration award, or civil judgment. A customer dispute is defined as a customer-initiated, investment-related complaint, arbitration proceeding, or civil suit containing allegations of sale practice violations against the broker.
• Twenty percent (20%) of Arive Capital Markets’ brokers have a criminal charge against the broker that has resulted in a conviction or plea arrangement.
• Sixteen percent (16%) of Arive Capital Markets’ brokers have an unsatisfied and outstanding judgment or lien against them.

In addition, fifty-two (52%) brokers have been accused of excessive trading, churning, or unauthorized trading.   Specific customer complaints and allegations can be found below.

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.

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.

Excessive trading, churning, and unauthorized trading are unethical and illegal. They are all also violations of securities rules and regulations and can cause enormous harm to customers.

ARIVE CAPITAL MARKETS:  DISCLOSURES BY BROKER  

Arive Capital Markets has approximately 25 registered individuals, five branch offices, and is headquartered in Brooklyn, New York.  The branch offices are believed to be in Brooklyn, NY, Staten Island, NY, Forest Hills, NY, Ronkonkoma, NY, and North Miami Beach, Florida.

Below is a summary of significant disclosures by Arive Capital Markets’ current workforce.  FINRA’s BrokerCheck tool can be used to obtain complete and updated disclosure reports.

Mitchell Scott Biernick (CRD No. 2690172):  Mr. Biernick, who currently works out of Arive Capital Markets’ branch office in Ronkonkoma, NY, has 25 years of experience in the securities industry. He currently has two customer complaints and a financial lien disclosure on his BrokerCheck report.

• Customer Complaint: In 2004, a customer filed a securities arbitration complaint alleging unauthorized trades, unsuitability, and frequent trades in the investment account at issue.  The dispute was settled by the firm that employed Mr. Biernick when the alleged conduct occurred.
• Customer Complaint: In 2015, a customer filed a written complaint alleging negligence, churning, misrepresentation, unsuitable investments, breach of fiduciary duty, and breach of contract. The customer did not file a securities arbitration complaint, and the firm that employed Mr. Biernick when the alleged conduct occurred denied any compensation to the customer.
• Financial Lien: Mr. Biernick has an unsatisfied and outstanding judgment or lien by American Express Bank for $20,356.

Lon Charles Faccini Jr. (CRD No. 2736849):  Mr. Faccini is currently employed as a broker with Arive Capital Markets in Brooklyn, NY. He has 24 years of experience in the securities industry, which includes five prior associations with firms that FINRA has expelled.  He currently has seven customer complaints on his BrokerCheck report. This blog has previously written about Mr. Faccini.  To read more about Mr. Faccini, please click here.

• Prior Associations: Faccini has been associated with five brokerage firms that FINRA has expelled:
  • LH Ross & Company, Inc. (1/9/2004 – 12/17/2004).
  • Continental Broker-Dealer Corp. (5/22/2003 – 1/21/2004).
  • Seaboard Securities, Inc. (6/5/1997 – 5/16/2002).
  • J. Meyers & Co., Inc. (4/21/1997 – 6/6/1997).
  • Investors Associates, Inc. (7/15/1996 – 4/18/1997).
• Customer Complaint: In 2019, a customer filed a securities arbitration complaint alleging excessive trading, unsuitability, and churning while Arive Capital Markets employed Mr. Faccini. Mr. Faccini denies the allegations, and the complaint is pending.
• Customer Complaint: In 2018, a customer filed a securities arbitration complaint alleging misrepresentation and unsuitability.  The complaint is pending.
• Customer Complaint: In 2015, a customer filed a securities arbitration complaint alleging breach of fiduciary duty, common law fraud, negligence/negligent misrepresentation, omissions, breach of contract, churning, and unsuitability related to exchange-traded funds.  An arbitration Panel found liability and awarded the customer monetary compensatory damages.
• Customer Complaint: In 2016, a customer filed a securities arbitration complaint alleging unsuitability related to equities.  The dispute was settled by the firm that employed Mr. Faccini when the alleged conduct occurred.
• Customer Complaint: In 2013, a customer filed a securities arbitration complaint alleging harassment and charging $40,000 in excess commissions. The dispute was settled by the firm that employed Mr. Faccini when the alleged conduct occurred.
• Customer Complaint: In 2010, a customer filed a securities arbitration complaint alleging a failure to follow instructions related to stop-loss orders.  The dispute was settled by the firm that employed Mr. Faccini when the alleged conduct occurred.

Roy Joseph Failla (CRD No. 2786551):  Mr. Failla, who has an indirect ownership stake in Arive Capital Markets, has 22 years of experience in the securities industry, which includes a past association with a firm that FINRA has expelled.  He currently works for Arive Capital Markets in Staten Island, NY.  In January 2021, he was suspended by the State of New Jersey Bureau of Securities for excessively and unsuitably traded two customers’ accounts. He also currently has three customer complaints on his BrokerCheck report.  This blog has previously written about Mr. Failla.  To read more about Mr. Failla, please click here.

• Regulatory Sanctions: In January 2021, the State of New Jersey Bureau of Securities suspended financial advisor Roy Joseph Failla from the securities industry for 45-days and fined him $15,000. The New Jersey regulator alleged Mr. Failla excessively and unsuitably traded two customers’ accounts.
• Prior Associations: Failla has worked at nine different broker-dealers, averaging less than 2.5 years at each firm.  Of the nine different firms, only two still exist.  The rest have been expelled by FINRA or have terminated their registration after a series of regulatory actions and customer complaints.
• Customer Complaint: In 2018, a customer filed a securities arbitration complaint alleging unauthorized trading and unsuitable investments that resulted in damages of $1.5 million.  The dispute was settled by the firm that employed Mr. Failla when the alleged conduct occurred.
• Customer Complaint: In 2010, a customer filed a securities arbitration complaint alleging churning/excessive trading, unsuitable trades, and misrepresentation that resulted in $417,000 in damages. The dispute was settled by the firm that employed Mr. Failla when the alleged conduct occurred.
• Customer Complaint: In 2010, a customer alleged excessive and unauthorized trading, fraud, breach of fiduciary duty, misrepresentation, and unsuitability, resulting in nearly $300,000 in damages.  The dispute was settled by the firm that employed Mr. Failla when the alleged conduct occurred.

Joseph Patrick Fuller (CRD No. 5277097):  Mr. Fuller has 11 years of experience in the securities industry and has been associated with 11 different broker-dealers, including a past association with a firm expelled by FINRA.  Twice his employment ended after alleged wrongful conduct.   He also currently has two customer complaints and five financial lien disclosures on his BrokerCheck report. Mr. Fuller currently works for Arive Capital Markets in Bay Ridge, NY.

• Prior Associations: Fuller has been associated with 11 different brokerage firms in 11 years, averaging approximately one year at each firm. He did two different stints at John Thomas Financial in 2008.  FINRA expelled John Thomas Financial in 2013.
• Employee separation after allegations: In 2017, Mr. Fuller was fired from Fordham Financial Management, Inc. The firm alleged that Mr. Fuller gained unauthorized access to the firm and private offices and stole its account records, other brokers’ records, and company property. In 2016, Mr. Fuller was “permitted to resign” from Cape Securities after a customer alleged unauthorized trading.
• Financial Liens: Mr. Fuller is the subject of five unsatisfied and outstanding judgments or liens, including a $13,770 IRS tax lien in 2019 and a $23,591 civil judgment in 2018.
• Customer Complaint: In 2018, seven customers filed a securities arbitration complaint alleging churning, unauthorized trading, unsuitable investments, misrepresentation, and breach of fiduciary duty that resulted in damages of over $6.6 million.  The dispute is pending.
• Customer Complaint: In 2013, a customer alleged that Mr. Fuller failed to follow instructions that resulted in damages. The dispute was settled by the firm that employed Mr. Fuller when the alleged conduct occurred.

Michael Joseph Hernandez (CRD No. 2295660):  Mr. Hernandez has 20 years of experience in the securities industry, which includes three prior associations with firms that FINRA has expelled.  He is currently registered with Arive Capital Markets in Brooklyn, NY.   In 2002, his employment was terminated by one of his previous employers.  In 2006, Mr. Hernandez was suspended by NASD, the predecessor to FINRA, for failing to comply with an arbitration award.  Mr. Hernandez currently has one customer complaints on his BrokerCheck report. To read more about Mr. Hernandez, please click here.

• Regulatory Sanctions: In 2006, NASD, the predecessor to FINRA, suspended Mr. Hernandez for failing to comply with an arbitration award.
• Prior Associations: Hernandez has been associated with three brokerage firms that FINRA has expelled:
  • EDI Financial, Inc. (1/18/2011 – 12/31/2016)
  • Strategic Resource Management, Inc. (3/27/1995 – 1/30/1996).
  • Chelsea Street Securities, Inc. (2/1/1993 – 6/23/1993).
• Employee separation after allegations: In 2002, Compass Brokerage, Inc. fired Mr. Hernandez for violating firm and affiliate bank policy regarding the management of personal bank accounts and company credit card.
• Customer Complaint: In 2005, a customer alleged that her investment portfolio lacked diversification and contained reckless risk-taking. The dispute was settled by the firm that employed Mr. Hernandez when the alleged conduct occurred.

Raquel E. Krispeal (CRD No. 5733217):  Ms. Krispeal has nine years of experience in the securities industry and has been associated with five different broker-dealers, including two past associations with firms that FINRA has expelled. She currently works for Arive Capital Markets in Bay Ridge, NY.

• Prior Associations: Krispeal has been associated with two brokerage firms that FINRA has expelled:
  • Legend Securities, Inc. (3/30/2015 – 12/7/2016; and 3/13/2013 – 2/27/2015).
  • John Thomas Financial (6/3/2010 – 4/16/2012).

Christian Frank Lucchetto (CRD No. 4648994):  Mr. Lucchetto has ten years of experience in the securities industry, which includes a past association with a firm that FINRA has expelled.  He currently works for Arive Capital Markets in Staten Island, NY. In January 2021, he was suspended by FINRA for excessively and unsuitably trading a customer’s accounts. He has also disclosed a criminal charge that has resulted in a conviction or plea arrangement. This blog has previously written about Mr. Lucchetto.  To read more about Mr. Lucchetto, please click here.

• Regulatory Sanctions: In January 2021, FINRA suspended Mr. Lucchetto from the securities industry for three months after alleging January 2018 through May 2019, while employed by First Standard Financial Company in Red Bank, NJ, Frank Lucchetto excessively and unsuitably traded a customer’s account.
• Prior Associations: Lucchetto has been associated with seven different brokerage firms in 10 years, averaging a little over one year at each firm. One of the firms has been expelled by FINRA.
• Criminal Disclosure: In 2006, Mr. Lucchetto was charged with felony possession of a controlled substance in the third degree. Lucchetto pleaded guilty to amended charges of possession of prescription drugs.

Daniel Joseph Marsillo (CRD No. 6538350):  Mr. Marsillo has four years of experience in the securities industry and has been associated with three different brokerage firms, including a firm that FINRA has expelled.  Mr. Marsillo, who currently works for Arive Capital Markets in Bay Ridge, NY, has one customer complaint on his BrokerCheck report.

• Prior Associations: Marsillo has been associated with three different brokerage firms in 4 years, averaging a little over one year at each firm. One of the firms, Meyers Associates, L.P., has been expelled by FINRA.
• Customer Complaint: In 2019, a customer alleged negligence related to common and preferred stock. The dispute is currently pending.

Donald Will Mercurio (Donald Louis Mercurio, Louis Donald Mercurio, Louis Mercurio) (CRD No. 722354):  Mr. Mercurio is currently registered with Arive Capital Markets in Forest Hills, NY.  He has 39 years of experience in the securities industry and has twice been fired by his employing firm.  In 1995, he was suspended and censured by the New York Stock Exchange (NYSE) Division of Enforcement for conduct inconsistent with just and equitable principles of trade.  Mr. Mercurio currently has three customer complaints on his BrokerCheck report.

• Regulatory Sanctions: In 1995, the NYSE Division of Enforcement suspended and censured Mr. Mercurio for conduct inconsistent with just and equitable principles of trade.
• Employee separation after allegations: In 1999, Mr. Mercurio was fired from Fahnestock & Co, Inc. for violating firm policies and state regulation by allegedly entering trades for a customer in a state in which he was not registered. In 1992, he was discharged by Dean Witter Reynolds, Inc. for the same reason, violating firm policies and state regulation by allegedly entering trades for a customer in a state in which he was not registered.
• Customer Complaint: In 2000, a customer filed a securities arbitration complaint alleging unsuitability related to common and preferred stock. The dispute was settled by the firm that employed Mr. Mercurio when the alleged conduct occurred.
• Customer Complaint: In 1999, a customer alleged that recommended common and preferred stocks were not suitable. The dispute was settled by the firm that employed Mr. Mercurio when the alleged conduct occurred.
• Customer Complaint: In 1999, a customer alleged unauthorized trading of warrants.

Mirsad A. Muharemovic (CRD No. 3122589):  Mr. Muharemovic has 22 years of experience in the securities industry and has been associated with nine different brokerage firms, including a firm FINRA has expelled.  Mr. Muharemovic, who currently works for Arive Capital Markets in Brooklyn, NY, has three customer complaints on his BrokerCheck report. To read more about Mr. Muharemovic, please click here.

• Prior Associations: Muharemovic has worked at nine different brokerage firms in 22 years, averaging a little over two years at each firm. One of the firms, Seaboard Securities, Inc, has been expelled by FINRA.
• Customer Complaint: In 2019, a customer filed a securities arbitration complaint against Mr. Muharemovic and Arive Capital Markets, alleging churning, excessive trading, and unsuitability.  Muharemovic denies the allegations, and the complaint is pending.
• Customer Complaint: In 2018, a customer filed a securities arbitration complaint against Mr. Muharemovic and Arive Capital Markets, alleging $1 million in damages arising out of unsuitable common and preferred stock.  Arive Capital Markets settled the dispute.
• Customer Complaint: In 2000, a customer filed a securities arbitration complaint alleging misrepresentation and omissions of material facts, high-pressure sales tactics, excessive trading, failure to diversify, fraud, negligence, breach of contract, and breach of fiduciary duty.  An arbitration Panel found liability and awarded the customer monetary compensatory damages.

Efthimios George Petrou (Tim Petrou) (CRD No. 2672840):  Mr. Petrou, who currently works out of Arive Capital Markets’ branch office in Ronkonkoma, NY, has 25 years of experience in the securities industry. He currently has one customer complaint on his BrokerCheck report.

• Customer Complaint: In 2005, a customer alleged unauthorized trading, breach of fiduciary duty, and misrepresentation.  The dispute was settled by the firm that employed Mr. Petrou when the alleged conduct occurred.

Terrence Reagan (Terrence Bartlett Reagan, Terrence Raggan) (CRD No. 2672751):  Mr. Reagan has 25 years of experience in the securities industry and is currently registered with Arive Capital Markets in Ronkonkoma, NY.  In 2015, National Securities Corp permitted Mr. Reagan to resign after allegedly taking proprietary property belonging to the firm.  Mr. Reagan also has a criminal disclosure and customer dispute on his BrokerCheck report.

• Employee separation after allegations: In 2015, Mr. Reagan was “permitted to resign” from National Securities Corp.    In connection with his termination, National Securities Corp stated that Mr. Reagan was currently under investigation for possible violations and/or taking of proprietary property belonging to the firm’s branch office.  Reagan denied the allegations and stated that the firm was retaliating against him for voluntarily resigning to pursue a different business opportunity.
• Criminal Disclosure: In 1985, Mr. Reagan was charged with felony grand larceny. According to his BrokerCheck report, the original charge was dismissed, and he pleaded guilty to a reduced misdemeanor harassment charge. Reagan also provided a comment, stating that he and a friend took his parent’s television set.
• Customer Complaint: In 2015, a customer alleged excessive trading.  The dispute was settled by the firm that employed Mr. Reagan when the alleged conduct occurred.

Michael Roizman (Micheal Roizman) (CRD No. 4502751):  Mr. Roizman has 11 years of experience in the securities industry and has been associated with eight different broker-dealers, which includes past associations with two firms that FINRA has expelled.  He currently works for Arive Capital Markets in Bay Ridge, NY.

• Prior Associations: Roizman has been associated with eight different brokerage firms in 11 years, averaging a little over one year at each firm. Two of the firms have been expelled by FINRA.
• Financial Liens: Mr. Roizman is the subject of three unsatisfied tax liens.

Ricardo Nkrumah Rose (Richard Rose) (CRD No. 4225756):  Mr. Rose has 20 years of experience in the securities industry and has been associated with nine different broker-dealers, which includes past associations with two firms that FINRA has expelled.  He currently works for Arive Capital Markets in Bay Ridge, NY. Mr. Rose currently has one customer complaint on his BrokerCheck report.

• Prior Associations: Rose has been associated with nine different brokerage firms in 20 years, averaging a little over two years at each firm. Two of the firms have been expelled by FINRA.
• Customer Complaint: In 2004, a customer alleged unauthorized trading.  The customer did not file a securities arbitration complaint, and the firm that employed Mr. Rose when the alleged conduct occurred denied any compensation to the customer.

Michael Dennis Salerno (CRD No. 4527806):  Mr. Salerno, who currently works out of Arive Capital Markets’ branch office in Bay Ridge, NY, has 18 years of experience in the securities industry, which includes a past association with a firm FINRA has expelled.  Mr. Salerno has two customer complaints on his BrokerCheck report.

• Prior Associations: In 2002, Mr. Salerno was associated with Continental Broker-Dealer Corp, which FINRA expelled in 2004.
• Customer Complaint: In 2017, a customer filed a securities arbitration complaint alleging unsuitability and churning. The dispute was settled by the firm that employed Mr. Salerno when the alleged conduct occurred.
• Customer Complaint: In 2017, a customer alleged unauthorized trading, churning, and unsuitable trading. The customer did not file a securities arbitration complaint, and the firm that employed Mr. Salerno when the alleged conduct occurred denied any compensation to the customer.

Daniel Louis Silverstein (Dan L. Silverstein) (CRD No. 4772971):  Mr. Silverstein, who currently works for Arive Capital Markets in North Miami Beach, FL, has 16 years of experience in the securities industry.  He has worked at eight different brokerage firms, including three firms that FINRA has expelled.  Mr. Silberstein currently has one customer complaint on his BrokerCheck report and three tax liens. This blog has separately written about Mr. Silverstein.  To read more about Mr. Silverstein, please click here.

• Prior Associations: Silverstein has been associated with eight different brokerage firms in 16 years, averaging two years at each firm. Three of the firms have been expelled by FINRA.
• Customer Complaint: In 2016, a customer filed a securities arbitration complaint alleging churning, excessive activity, unauthorized trading, breach of fiduciary duty, and margin credit extension. The dispute was settled by the firm that employed Mr. Silverstein when the alleged conduct occurred.
• Financial Liens: Mr. Silverstein is the subject of three unsatisfied tax liens.

John Marshall Williams (CRD No. 2833948):  Mr. Williams is Arive Capital Markets’ current Chief Compliance Officer and works out of the firm’s office in Bay Ridge, NY.  Mr. Williams has 21 years of experience in the securities industry and has worked at 15 different brokerage firms, including six firms that FINRA has expelled.  In 2001, Mr. Williams was suspended by the Utah Division of Securities for physically denying auditors access to books and records during an audit.  Mr. Williams currently has one customer complaint on his BrokerCheck report.

• Regulatory Sanctions: In 2001, Mr. Williams was suspended by the Utah Division of Securities.  The regulator alleged that Mr. Williams, while employed by LH Ross & Company, Inc, physically denied auditors accessed to books and records of the firm and acted in a supervisory role over the office location where auditors witness books and records of the firm being hidden and discarded.
• Prior Associations: Williams has been associated with 15 different brokerage firms in 21 years, averaging just over one year at each firm. Six of the firms have been expelled by FINRA.
• Customer Complaint: In October 2020, a customer filed a securities arbitration complaint against Mr. Williams and Arive Capital Markets alleging unauthorized trading.   Williams denies the allegations, stating that he was neither the broker nor supervisor of the disputed trade.  The dispute is currently pending.

In a follow-up blog post, Iorio Altamirano LLP will take a closer look at brokers who have previously been registered with Arive Capital Markets, including seven brokers FINRA has barred from the securities industry.  Those brokers include:

Name	CRD No.	Date of Expulsion
John Joseph Santariello	5746158	3/6/2020
Mark Anthony Figueroa	5750447	10/28/2019
Lisa Acca	4661358	8/8/2019
John Phillip Correnti	5319471	8/23/2017
Casey Thomas Rodriguez	4870499	7/21/2017
Christopher Michael Lippus	5743734	5/19/2017
Mark Carmen Casolo	1158074	4/5/2013

ARIVE CAPITAL MARKETS – MANAGEMENT AND OWNERSHIP 

The troubled history of Arive Capital Markets’ workforce is a reflection of the firms’ management and ownership. The firm is run and owned by individuals who have disclosure reports that are littered with red flags.

With regard to management, three of the top four (75%) executives have been the subject of regulatory sanctions.  The Chief Executive Officer (CEO), Chief Financial Officer (COO), and Chief Compliance Officer (CCO) have all been sanctioned by regulators, including CCO John Marshall Williams. The latter was suspended in 2001 by the Utah Division of Securities for physically denying auditors access to books and records during an audit.  As described above, Mr. Williams has also been employed by six firms that FINRA has expelled.

As to ownership, three individuals who have an ownership stake in Arive Capital Markets have concerning backgrounds, including two regulatory actions that have resulted in suspensions.

According to public records, the majority owner of Arive Capital Markets is an entity called Liberty View Holdings LLC.  Liberty View Holdings LLC is co-owned by at least two individuals. The first individual is a registered representative and the President of Alexander Capital, L.P., which employs much of the same questionable sales practices as Arive Capital Markets.  This individual has also previously been associated with a firm expelled by FINRA.

The other co-owner of Liberty View Holdings LLC is also a registered representative with Alexander Capital, L.P and has a history of customer complaints, questionable past associations, and a regulatory sanction.  According to his BrokerCheck report, this individual currently has two customer complaints, including a $1.5 million claim in 2013.  Additionally, the report reveals that this individual has been associated with four firms that FINRA has expelled, including a firm as recently as 2012.  Finally, the report reveals that regulators sanctioned this individual in 2006.  He was suspended for one month and fined $113,035 for engaging in a private placement offering that included an offering memorandum that was false and misleading.

Arive Capital Markets is also partially owned by Unified Wealth Management, LLC, which is partially owned by Roy Joseph Failla. As discussed above, Mr. Failla, who currently works for Arive Capital Markets, was suspended by the State of New Jersey Bureau of Securities in January 2021 for excessively and unsuitably traded two customers’ accounts. Mr. Failla also has a past association with a firm that FINRA has expelled and currently has three customer complaints on his BrokerCheck report.  This blog has previously written about Mr. Failla.  To read more about Mr. Failla, please click here.

How to Recover Financial Losses or Obtain a Free Consultation

Securities arbitration is a unique and complex practice area. Investors should seek out experienced counsel who understands the FINRA forum and can navigate the arbitration process to effectively advocate on their behalf.

If you or a loved one were a customer of Arive Capital Markets and either sustained financial losses or suspect inappropriate activity in your investment or retirement accounts, 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 evaluation of your account.

Iorio Altamirano LLP is a securities arbitration law firm based in New York, NY.   Iorio Altamirano LLP pursues FINRA arbitration claims nationwide on behalf of investors to recover financial losses arising out of wrongful conduct by stockbrokers and brokerage firms.