Investigation of Former SW Financial Broker John Cangialosi

SW Financial

Erez Law is interested in speaking with investors who may have suffered losses due to investments with former SW Financial broker John Cangialosi (CRD# 3273830). He was registered with SW Financial in New York, New York, from 2019 to 2022, and with Worden Capital Management LLC in New York, New York, from 2016 to 2019. Previously, he was registered with Legend Securities, Inc. in New York, New York, from 2013 to 2016. Before then, he was registered with three other firms, including J.P. Turner & Company, LLC, which he was terminated from regarding “unauthorized trading.”

In May 2013, FINRA sanctioned him to pay a $5,000 civil and administrative penalty and fine and suspended him for three months regarding his failure to disclose judgments or liens on his uniform application. 

In January 2016, the state of Michigan withdrew his registration “because Applicant engaged in dishonest and unethical practices within the last 10 years, which supports the denial of his registration application.”

In August 2021, the Maryland Division of Securities was suspended for nine months and was sanctioned to pay a $7,500 fine and restitution in the amount of $221,622 for engaging in excessive and unsuitable trading, which resulted in losses of $405,255 and trading costs of $311,229. 

According to his BrokerCheck, “Cangialosi consented to the sanctions and to the entry of findings that he engaged in quantitatively unsuitable trading in three customer accounts. The findings stated that Cangialosi recommended high frequency trading in the accounts, with each customer often holding concentrated positions in one or two securities for short periods of time. Cangialosi’s customers routinely followed his recommendations and, as a result, he exercised de facto control over the accounts. Cangialosi’s trading also resulted in high turnover rates and cost-to-equity ratios as well as significant losses. Cangialosi’s trading in the customers’ accounts was excessive and unsuitable given the customers’ investment profiles. As a result, the customers suffered collective realized losses of $405,255, while paying total trading costs of $311,229, including commissions of $292,657.”

John Cangialosi Customer Complaints

He has been the subject of nine customer complaints between 2009 and 2022, three of which were closed without action, according to his CRD report. Recent complaints were regarding: 

December 2022.Unsuitable investments, churning, failure to supervise, negligence.” The customer is seeking $510,152.82 in damages, and the case is currently pending. The complaint took place while he was registered with SW Financial, and it was regarding common and preferred stocks.

March 2022. “Churning, excessive commissions, unauthorized trading, unsuitability, negligence, breach of contract, fraud.” The customer is seeking $1,281,156 in damages, and the case is currently pending. The complaint took place while he was registered with Worden Capital Management LLC, and it was regarding common and preferred stocks.

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, SW Financial may be liable for investment or other losses suffered by John Cangialosi’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.

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