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Madison Avenue Securities Financial Advisor David Barber Client Wins $1.67 Million for Unauthorized and Unsuitable Trades

Posted on Monday, January 15th, 2018 at 9:36 am    

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Erez Law is currently investigating Madison Avenue Securities financial advisor David Barber (CRD# 1165082) regarding churning, unauthorized trading, unsuitable trading, breach of fiduciary duty and failure to supervise. Barber has been registered with Madison Avenue Securities, LLC in San Diego, California since 2015. Previously, he was registered with First Midwest Securities, Inc. in Newport Beach, California from 2011 to 2015. He was previously registered with Raymond James & Associates, Inc. in Newport Beach, California from 2007 to 2011, before he was terminated regarding, “Financial advisor was terminated after an internal investigation was conducted following the receipt of a client complaint alleging misappropriated funds. The firm concluded the financial advisor violated firm policies relating to outside business activities as well as violated firm policies and industry regulations as they relate to selling away. The firm lost confidence in the financial advisor’s ability to perform his duties when he failed to cooperate during an internal investigation.”

In January 2018, FINRA awarded a San Diego, California investor $1.67 million in compensatory and punitive damages for claims against Barber and Madison Avenue Securities. Barber was ordered to pay $1.2 million in compensatory and punitive damages, while Madison Avenue Securities was ordered to pay the remaining amount. The FINRA panel also awarded the claimant’s attorney fees of $868,000 and $44,000 in costs, which are to be paid jointly by Barber and Madison Avenue Securities. Barber and Madison Avenue Securities were found liable for churning, unauthorized trading, unsuitable trading, breach of fiduciary duty and failure to supervise.

In March 2013, FINRA sanctioned Barber to $25,000 in civil and administrative penalties and fines and suspended him for four months regarding receiving five loans totaling $867,000 from three customer of his member firm, whom were his personal friends before they established securities accounts with him at his firm. Barber concealed the five loans from the firm by routing them through an outside business that he owned. Additionally, Barber failed to provide prompt written notice to his firm of his involvement in his company, an undisclosed outside business activity.

Barber has been the subject of three customer complaints between 2001 and 2016, one of which was denied and one was withdrawn, according to his CRD report:

May 2016. “Excessive trading, unauthorized trading, unsuitable trading, breach of fiduciary duty and failure to supervise from March 2015 through February 2016.” The customer is seeking $300,000 in damages and the case is currently pending.

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, Madison Avenue Securities may be liable for investment or other losses suffered by Barber’s customers.

Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If and 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.