Frank Martin Allegedly Failed to Catch Signs of Excessive Trading
Frank Martin (CRD #: 2859847) has been suspended by FINRA. This is according to his BrokerCheck record, accessed on December 11, 2023. Keep reading if you have questions about the suspension.
On October 11, 2023, Frank Marting consented to FINRA’s findings that he failed to reasonably supervise registered representatives. These representatives allegedly excessively traded customer accounts. According to the Acceptance, Waiver, and Consent agreement, there were signs of excessive trading, including high turnover and high cost-to-equity ratios in numerous accounts.
- Turnover is the number of times a broker exchanges one portfolio of securities for another.
- Cost-to-equity is the ratio of trading costs compared to the account balance.
Frank Martin allegedly failed to investigate red flags of unsuitable or excessive trading, such as frequent trading and in-and-out trading. He did, however, sign off daily blotters indicating he had reviewed the trades.
FINRA alleges that the excessive trading caused customers to pay $663,463 in commissions, fees, and margin interest.
Failure to Supervise 3110
FINRA Rule 3110 requires that firms establish systems of supervision to maintain their compliance with securities regulations. This includes appointing supervisors and providing them with Written Supervisory Procedures (WSPs).
Excessive Trading
FINRA Rule 2111, a.k.a. The Suitability Rule, requires brokers to tailor their investment recommendations to suit investors’ needs. Trades must be quantitatively suitable, meaning the number of trades must suit an investor’s needs. Each trade comes with a transaction fee, so too many transactions will result in excessive fees for the investor. Excessive trading is also known as “churning.”
Terms of the AWC
As part of the terms of the AWC, Frank Martin consented to a three-month suspension. You can read a copy of the AWC here.
Background Information
Frank Martin has passed the following exams:
- Series 65 Uniform Investment Adviser Law Examination
- Series 63 Uniform Securities Agent State Law Examination
- SIE – Securities Industry Essentials Examination
- Series 7 General Securities Representative Examination
- Series 24 General Securities Principal Examination
He is a registered broker and investment adviser in New York, Pennsylvania, and Texas. He is a registered broker in 16 other states.
Frank Martin has registered with 11 firms:
- LPL Financial (CRD #: 6413)
- Arrive Capital Markets (CRD #: 8060)
- JP Turner & Company (CRD #: 43177)
- Investors Capital Corp (CRD #: 30613)
- Source Capital Group (CRD #: 36719)
- Merit Capital Associates (CRD #: 30576)
- Bluestone Capital Corp. (CRD #: 13516)
- Dalton Kent Securities Group (CRD #: 38813)
- Josephthal & Co. (CRD #: 3227)
- Continental Broker-Dealer Corp. (CRD #: 14048)
- Gaines Berland (CRD #: 14623)
Kurta Law Can Help
If you have worked with Frank Martin and have concerns about your investments, do not hesitate to contact us at 877-600-0098 or info@kurtalawfirm.com for a free consultation.
For nearly 20 years, Kurta Law has advocated for investors to recover their investment losses from brokers and brokerage firms. Kurta Law is a nationally recognized law firm that exclusively represents investors against brokers and brokerage firms on a contingency basis. This means that the firm only earns a fee if our securities attorneys recover money on your behalf. Do not let securities fraud go unchecked. Start your recovery process today.
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