Investor Alert: Former Southern Trust Securities, Inc. Broker Robert Escobio Losses
Posted on Wednesday, October 2nd, 2019 at 6:37 am
Are you the victim of former Southern Trust Securities, Inc. broker Robert Escobio (CRD# 703813)? Escobio was registered with Southern Trust Securities, Inc. in Miami, Florida from 2000 to 2017.
In February 2020, Escobio was barred from the securities industry after he failed to cooperate with an investigation in allegations that he continued to associate with a broker-dealer after being disqualified for allegedly defrauding investors.
In July 2019, “Escobio was named a respondent in a FINRA complaint alleging that he has repeatedly failed to provide information and documents requested by FINRA in an investigation involving whether he continued to associate with a FINRA member firm while he was statutorily disqualified, after the NAC denied the MC-400 application. The complaint alleges that Escobio failed to appear and provide sworn testimony to FINRA Staff on five separate occasions, as requested.” This is on appeal.
In July 2017, Escobio was the subject to a statutory disqualification as a result of the August 29, 2016 Final Judgment filed in the U.S. District Court for the Southern District of Florida which permanently enjoined him from directly or indirectly engaging in a number of activities governed by the Commodity Exchange Act and from applying for registration and engaging in any activity requiring registration under the Commodity Exchange Act. According to Escobio’s BrokerCheck, “The Application was denied for the following reasons: (1) Escobio’s disqualifying event is recent and egregious; (2) Escobio “has engaged in a pattern of fraudulent practices”; (3) the proposed primary supervisor lacks the requisite experience and objectivity to stringently supervise a statutorily disqualified individual such as Escobio; (4) the proposed backup supervisor for Escobio is inadequate; and (5) the Firm has proposed an inadequate heightened supervisory plan.” This is currently on appeal.
In May 2016, the Florida Office of Financial Regulation alleged that Escobio was the subject of a decision by a national commodities or option association (NFA) involving a violation of its rules.
In July 2014, the U.S. Commodity Futures Trading Commission alleged that two companies, by and through their officers, employees, and agents, including Escobio, operated a scheme in which defendants defrauded retail customers in connection with illegal, off-exchange, financed precious metals transactions. Defendants received more than $2.6 million from at least 135 customers who collectively lost at least $600,000 in connection with this scheme, according to Escobio’s BrokerCheck profile. “In addition to and separate from defendants’ off-exchange metals scheme, defendants solicited and accepted orders for the purchase or sale of commodities for future delivery and commodity options on or subject to the rules of a contract market without registering with the commission as a futures commission merchant (“FCM”). Defendants unlawfully received more than $900,000 from customers for futures and options trading.” Escobio was sanctioned to $2,103,617 in restitution, plus post-judgment interest on restitution and civil monetary penalty.
In August 2013, the National Futures Association alleged that Escobio employed a company to act as an unregistered futures commission merchant (FCM) and then attempted to conceal this activity by a series of money transfers from the company to its foreign affiliate to another foreign company to a registered FCM. Escobio was sanctioned to a $50,000 civil and administrative penalty.
Escobio has been the subject of five customer complaints between 1985 and 2005, one of which was withdrawn, three were settled, and one was awarded in favor of the client. according to his CRD report.
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, Southern Trust Securities, Inc. may be liable for investment or other losses suffered by Escobio’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.