Erez Law is currently investigating Morgan Stanley brokers Darryl Cohen (CRD# 2786613) regarding non-broker dealer product investment losses and selling away. The broker is part of the Global Sports Entertainment Group at Morgan Stanley, which focuses on athletes and entertainers who are likely to have short-lived income streams.
According to public records, two former NBA players, Chandler Parsons and his former roommate Courtney Lee, are suing Morgan Stanle and seeking $5 million in damages. According to the claim, “payments were made without prior approval” from their accounts between 2017 and 2019. The claim also alleges that the NBA players were encouraged to “take out a liquidity access line of credit for real estate and life insurance policies, which they now claim they hold no interest.”
The FINRA investigation found that most of the customer complaints involved former and current professional athletes.
In December 2021, FINRA barred Darryl Cohen after he failed to fully and completely respond to multiple requests by FINRA for information and documents in connection with an investigation into improper use of customer funds and possible conversion. FINRA sought to obtain the following documents:
- communications regarding his customers and business, including electronic communications such as emails, texts, and social media posting
- bank account statements
- telephone logs and records
According to the FINRA filing, the staff had “concerns about unusual or suspicious money movement.”
Darryl Cohen was registered with Morgan Stanley in Westlake Village, California from 2015 until January 2021, when he was terminated regarding, “Allegations relating to the representative’s facilitation of outside client business and transactions not disclosed to or approved by Morgan Stanley and use of an unapproved platform to engage in inappropriate communications with clients.”
Darryl Cohen Customer Complaints
Darryl Cohen has been the subject of nine customer complaints between 2001 and 2021, one of which was denied and one was closed without action, according to his CRD report. Recent complaints are regarding:
October 2021. “Claimants allege, inter alia, that payments were made without prior approval from their accounts and in that they were encouraged to use a Liquidity Access Line for real estate and life insurance policies for which they now claim they hold no interest. 2017-2019.” The customer is seeking $2 million in damages.
April 2021. “Claimant alleges, inter alia, misrepresentation with respect to recommendation for outside business investment utilizing a line of credit from the firm- June 2019.” The customer is seeking $100,000 in damages.
April 2021. “Claimants allege, inter alia, unsuitability with respect to investments and Credit line – 2015 through 2020.” The customer is seeking $2.3 million in damages.
January 2021. “Claimants allege, inter alia, that payments were made without prior approval from their accounts and that they were encouraged to use a Liquidity Access Line for real estate and life insurance policies for which they now claim they hold no interest. 2017-2019.” The customer is seeking $5,000,000 in damages and the case is currently pending. The complaint is regarding non-broker dealer activity with two NBA players.
June 2020. “Claimant alleges unsuitability with respect to the use of Liquidity Access Line to loan funds to outside business entities.” The case was settled for $125,000.0
Pursuant to FINRA Rules, member firms are responsible for supervising a broker’s activities during the time the broker is registered with the firm. Therefore, Morgan Stanley may be liable for investment or other losses suffered by Darryl Cohen’s customers.
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If you have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies on a contingency fee basis.