Joseph Gunnar & Co.

Kurta Law is investigating recommendations by Joseph Gunnar & Co. brokers. Joseph Gunnar & Co. (CRD#: 24795) is a dually registered broker-dealer and investment advisory firm. Its headquarters is in Uniondale, New York.

Joseph Gunnar & Co. has also operated under the following names:

• American Pride Wealth Management Group
• Lellos Wealth Management
• East End Securities

Fees and Conflicts of Interest

Joseph Gunnar & Co. discloses how the firm and its financial advisors make money in its Customer Relationship Summary:

• Investors will be charged fees for each transaction made in their brokerage account, incentivizing the firm to encourage trading.
• Joseph Gunnar & Co. may receive more revenue from brokerage accounts with high trading frequency and volume and more revenue from low-activity advisory accounts, incentivizing the firm to encourage clients to switch account types.
• RBC Capital Markets is Joseph Gunnar & Co.’s clearing and custody partner, and may charge investors fees associated with accounts transfers, liquidations, and other transactions.
• Clients with investment advisory accounts pay an asset-based “wrap fee,” which increases based on the value of your assets and also includes the cost of certain services. Wrap fee accounts charge higher fees than strictly asset-based fee accounts, and also discourage the firm from trading your account.
• Some investments (e.g., mutual funds, ETFs, UITs) may charge early termination or surrender fees when investors sell early, as well as ongoing fees for as long as you hold the investment.
• Joseph Gunnar & Co. and affiliates may earn additional compensation when you invest in certain products, and the firm may receive compensation from third parties for selling certain investments.
• The firm has revenue sharing agreements with the managers and sponsors of certain investment products (namely mutual funds and private pooled investment vehicles).

Broker-Dealer Services

Besides stocks and bonds, Joseph Gunnar & Co. also offers the following investment products. Some of these investments can come with substantial fees and high risk.

• Mutual funds
• Exchange-traded funds (ETFs)
• Options
• Fixed-income securities
• Certificates of Deposit (CDs)
• Unit investment trusts (UITs)
• Structured notes
• Variable annuities and variable life insurance

Regulatory Actions

On its detailed BrokerCheck page, Joseph Gunnar & Co. discloses the regulatory actions it has been involved in. 

Alleged Charging of Unfair Commissions

In a Letter of Acceptance, Waiver & Consent (AWC) filed on July 8, 2024, Joseph Gunnar & Co. consented to the entry of findings that it allegedly charged an unfair minimum commission of $100 on equity transactions, resulting in many commissions equalling 5.01% to 55.56% of the principal transaction amount.

FINRA Rule 2121.01 provides guidelines for determining the fairness of commissions, including the “5% policy.” However, even commissions below 5% can be considered unfair once the other guidelines are considered.

The AWC further alleged that the firm failed to put into place a supervisory system that would monitor the fairness of commission on transactions, and also failed to file offering documents with FINRA concerning 14 private placements.

FINRA censured the firm, fined it $65,000, and ordered the firm to pay $69,898.17 plus interest in restitution to investors. You can access the full AWC here.

Alleged Failure to Establish AML Program

On December 4, 2020, Joseph Gunnar & Co. consented to the entry of findings that it allegedly failed to adequately establish and implement an Anti-Money Laundering (AML) program to detect and report red flags in transactions of low-priced securities from May 2017 through June 2018.

The firm’s AML procedures allegedly failed to describe common red flags, such as:

• Sudden spikes in demand for a low-priced security concurrent with rising price
• Multiple firm clients transacting in thinly traded low-priced securities
• Clients’ trading comprising a large volume of the total market trading for a low-priced securities
• Patterns of depositing low-priced securities then liquidating and withdrawing or wiring the profits from the account

The firm allegedly also failed to establish a due diligence program to detect and report suspected money laundering activity relating to correspondent accounts for foreign financial institutions.

FINRA censured the firm and fined them $55,000. You can read the full AWC here.

Alleged Failure to Supervise Recommendations

In an AWC filed on December 5, 2017, Joseph Gunnar & Co. consented to the entry of findings that it allegedly failed to implement a supervisory system reasonably designed to prevent a broker’s unsuitable trading from 2010-2015.

More specifically, the AWC alleged that broker AS recommended unsuitably high-risk and speculative securities to a senior investor, and that these recommendations caused the client to be excessively concentrated in these securities. These recommendations, and in-and-out trading of these investments, allegedly resulted in more than $150,000 in losses.

The firm was censured and fined $60,000. You can read the AWC here.

Brokers with Misconduct Allegations on Their Records

Kurta Law is aware of the following current or former brokers associated with Joseph Gunnar & Co. who have BrokerCheck disclosures. This is not an exhaustive list, so investors with concerns about their broker should contact a securities attorney.

• Anthony Sica: https://www.kurtalawfirm.com/blog/anthony-sica/ 
• David Cooper: https://www.kurtalawfirm.com/blog/david-cooper/ 
• Leonard Rich: https://www.kurtalawfirm.com/blog/leonard-rich/ 
• Stephen Marek: https://www.kurtalawfirm.com/blog/stephen-marek/ 
• Michael Wagner: https://www.kurtalawfirm.com/blog/michael-wagner/ 

Kurta Law Can Help

Investors who lost money working with a Joseph Gunnar & Co. broker or advisor should reach out to an investment fraud lawyer for help. Our attorneys offer free case evaluations and do not charge a fee unless we win your case. Call (877) 600-0098 or email info@kurtalawfirm.com.