Erez Law is currently investigating former SW Financial broker John Cangialosi (CRD# 3273830) regarding common and preferred stock losses. He was registered with SW Financial in New York, New York, from 2019 to 2022, Worden Capital Management LLC in New York, New York, from 2016 to 2019, Legend Securities, Inc. in New York, New York, from 2013 to 2016, Joseph Gunnar & Co. LLC in Staten Island, New York, from 2012 to 2013, Brookstone Securities, Inc. in Staten Island, New York, from 2009 to 2012, and J.P. Turner & Company, L.L.C. in Staten Island, New York, from 2006 to 2009, when he was terminated regarding, “unauthorized trading.”
In April 2013, FINRA sanctioned him to pay a $5,000 civil and administrative penalty and fine and suspended him for three months following allegations that he “failed to disclose, and in some instances to timely disclose on his uniform application for securities industry registration or transfer (form U4) six unsatisfied judgments and/or liens.”
In January 2016, the state of Michigan ordered a stipulations and order for withdrawal following allegations that he, “engaged in dishonest and unethical practices within the last 10 years, which supports the denial of his registration application under the above-cited provisions of the Michigan Uniform Securities Act (2002).”
In August 2021, FINRA sanctioned him to pay a $7,500 civil and administrative penalty and fine, a $271,622 in restitution, and suspended him for nine months following allegations that he “engaged in quantitatively unsuitable trading in three customer accounts.” FINRA found that he “recommended high frequency trading in the accounts, with each customer often holding concentrated positions in one or two securities for short periods of time.” Additionally, FINRA found that he exercised de facto control over the accounts and engaged in trading that resulted in high turnover rates and cost-to-equity ratios as well as significant losses. FINRA found that the trading in customers’ accounts was “excessive and unsuitable given the customers’ investment profiles.”
In August 2021, the Maryland Division of Securities sanctioned him to a nine-month suspension, a $7,500 fine, $221,622 in restitution for engaging in excessive and unsuitable trading, resulting in collective realized losses of $405,255 and trading costs of $311,229.
In March 2024, FINRA barred him after he “consented to the sanction and to the entry of findings that he refused to appear for on-the-record testimony requested by FINRA in connection with its examination of Cangialosi’s outside business activities.”
John Cangialosi Customer Complaints
He has been the subject of 10 customer complaints between 2009 and 2022, three of which were closed without action, according to his CRD report. The most 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 Worden Capital Management LLC, and it was regarding equity OTC and common and preferred stocks.
October 2022. “John Cangialosi was a subject of the customer’s complaint against his member firm that asserted the following causes of action: unsuitability, breach of fiduciary duty, breach of contract, negligence, unjust enrichment, strict liability, and failure to supervise.” The customer is seeking $10,900,000 in damages, and the case is currently pending.
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 equity OTC and common and preferred stocks.
January 2018. “Churning/quantitative suitability; unsuitable investments; unauthorized trading; negligence; breach of fiduciary duty; and, breach of contract.” The customer sought $386,279.09 in damages, and the case was settled for $30,000. The complaint took place while he was registered with Legend Securities, Inc., and it was regarding common and preferred stocks.
November 2015. “Statement of Claim alleges: Fraudulent and Negligent Acts, Breach of Contractual Requirements, Churning, Unsuitability, and Negligent Misrepresentation.” The case was settled for $100,000. The complaint took place while he was registered with Brookstone Securities, Inc., and it was regarding equity OTC and 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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