- July 9, 2024
- Oppenheimer & Co.
Gustavo S. Miramontes (CRD: 2338966) is a registered broker with Oppenheimer & Co. Inc. in Los Angeles, CA.
Broker’s Background
He entered the securities industry in 1996 and previously worked with M.L. Stern & Co., LLC; Southwest Securities, Inc.; Wells Fargo Advisors, LLC; and Wedbush Securities, Inc.
Current and Past Allegations of Conduct Leading to Investment Loss
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in September 2023, Gustavo Miramontes became the subject of a customer dispute where the claimant asserted, “claims for breach of fiduciary duty, churning, negligence, negligent misrepresentation, falsifying account documentation, unauthorized trading as well as violations of FINRA rules and state securities laws. 01/2019 – 06/2023.” The damage amount requested in $151,477 and the customer dispute is still pending.
In addition, Gustavo Miramontes has been the subject of thirteen other disclosures:
- December 20, 2021— “CLIENT ALLEGES THAT UNAUTHORIZED TRANSACTIONS TOOK PLACE IN THEIR ACCOUNT, AND THAT INVESTMENTS WERE UNSUITABLE. NO TIME PERIOD SPECIFIED, BUT INVESTMENTS TOOK PLACE BETWEEN JULY 2019 – NOVEMBER 2021.” The customer dispute settled for $7,558.00
- December 19, 2021—“CLIENT ALLEGES THAT UNAUTHORIZED TRANSACTIONS TOOK PLACE IN THEIR ACCOUNT, AND THAT INVESTMENTS WERE UNSUITABLE. NO TIME PERIOD SPECIFIED, BUT INVESTMENTS TOOK PLACE BETWEEN JULY 2019 – NOVEMBER 2021. The damage amount requested was $11,000 and the customer dispute settled for $8,149.00.
- December 16, 2021—“CLIENT ALLEGES THAT UNAUTHORIZED TRANSACTIONS TOOK PLACE IN THEIR ACCOUNT, AND THAT INVESTMENTS WERE UNSUITABLE. NO TIME PERIOD SPECIFIED, BUT INVESTMENTS TOOK PLACE BETWEEN JULY 2019 – NOVEMBER 2021.” The customer dispute settled for $7,957.00.
- December 16, 2021—“CLIENT ALLEGES THAT UNAUTHORIZED TRANSACTIONS TOOK PLACE IN THEIR ACCOUNT, AND THAT INVESTMENTS WERE UNSUITABLE. PERIOD IS OCTOBER 2018 THROUGH 11/30/2021.” The customer dispute settled for $8,222.00.
- November 2021—“CLIENT ALLEGES THAT UNAUTHORIZED TRANSACTIONS TOOK PLACE IN THEIR ACCOUNT, AND THAT INVESTMENTS WERE UNSUITABLE. TIME PERIOD IS SEPTEMBER 2018 TO PRESENT.” The customer dispute settled for $7,981.00.
- April 2019— “Client demanding that a trade should be rescinded due to the former financial advisor misrepresenting the facts surrounding the bond purchased on 6/4/2018.” The damage amount requested was $24,302.83 and the customer dispute settled for $24,302.83.
- November 2018— “CLIENT ALLEGES SHE DID NOT AUTHORIZE CERTAIN BOND TRANSACTIONS WHICH TOOK PLACE IN HER ACCOUNT. SHE BELIEVES THESE TRANSACTIONS WERE NOT SUITABLE FOR HER RISK PROFILE.” The customer dispute settled for $431,401.45.
- October 2016—Financial Disclosure- Bankruptcy: “Discharged.”
- August 2011— “CLIENT ALLEGES THAT FINANCIAL ADVISOR PURCHASED MUTUAL FUNDS WITHOUT HER PRIOR APPROVAL. FURTHER ALLEGES THAT THE MONTHLY INCOME THE FUNDS WOULD PROVIDE WAS MISREPRESENTED. CLIENT ALLEGES DAMAGES, NOT SPECIFIED, BELIEVED TO EXCEED $5,000. ACTIVITY DATE IS 7/7/2011.” The customer dispute settled for $6,500.
- December 2009— “CLAIMANT ALLEGES NEGLIEGENCE, FAILURE TO SUPERVISE- FINRA RULE 3010, UNSUITABLE RECOMMENDATIONS-FINRA RULE 2310, MISREPRESENTATION, FRAUD, BREACH OF FIDUCIARY DUTY, VIOLATION OF THE SECURITIES EXCHANGE ACT OF 1934; CALIFORNIA CORPORATION CODE 25400, ET SEQ’ AND CALIFORNIA CODE OF REGULATIONS, VIOLATION OF FINRA RULE 2110 STANDARDS OF COMMERCIAL HONOR AND PRINCIPALS OF TRADE FROM DECEMBER 2006 THROUGH FEBRUARY 2009.” The damage amount requested was $381,942.00 and the customer dispute settled for $180,000.00.
- November 2008— “CLIENT CLAIMS HE TOLD REPRESENTATIVE THAT HE ONLY WANTED INVESTMENTS THAT WERE SHORT TERM WITH PRINCIPAL GUARANTEED. CLIENT PURCHASED CMOS IN 2003 AND 2004 AND SOLD THEM UNSOLICITED IN JULY 2007 PRIOR TO MATURITY AT A LOSS.” The damage amount requested was $10,000.00 and the customer dispute was denied.
- July 1994— “Criminal Charges, “ DISPOSITION-CONVICTED THEFT (MISDEMEANOR STATUS) PENAL CODE #487.1, DATE 10/31/94. SENTENCE-12DAYS COMMUNITY SERVICE AND PAID RESITUTION – $1,589.79 STARTING 1/9/95 THROUGH 1/24/95.”
For a copy of Gustavo Miramontes’ FINRA BrokerCheck, click here.
We Help Investors Recover Investment Losses
Financial advisors have a legal and regulatory obligation to recommend only suitable investments that are appropriate for their clients’ needs and objectives. Their employing brokerage firm has a legal and regulatory obligation to supervise the Financial Advisors’ sales practices and dealings with clients. To the extent any of these duties are breached, the customer may be entitled to a recovery of his or her investment losses.
Reasonable basis suitability requires that a recommended investment or investment strategy be suitable or appropriate for at least some investors. Reasonable basis suitability requires an advisor to conduct adequate due diligence so that he or she can determine the risks and rewards of the investment or investment strategy.
Customer-specific suitability requires that a member or associated person have a reasonable basis to believe that the recommendation is suitable for a particular customer based on that customer’s investment profile. Among the criteria that a financial advisor must evaluate to satisfy his or her customer-specific suitability obligations include the investor’s age, tax status, time horizon, liquidity needs, and risk tolerance; a client’s other investments, financial situation and needs, investment objectives, and any other information disclosed by the customer should also be considered.
FINRA regulations require that a customer’s written authorization is required before a broker-dealer can carry out transactions in the customer’s account. In addition, the broker-dealer’s member firm needs to approve the broker-dealer’s authorization. These measures are intended to protect the customer. Discretionary trading allows the broker-dealer to unilaterally decide to buy or sell securities at any price and not have to check with the client first. Exercising discretion without authorization can be costly to investors, and broker-dealers and their member firms, too.
FINRA Rule 2150 specifically addresses theft and conversion in a customer account, stating “no member or person associated with a member shall make improper use of a customer’s securities or funds.” This rule includes any “guarantee” that brokers make to customers in relation to losses incurred in a brokerage account.
In addition, FINRA Rule 3240 strictly prohibits a financial advisor from borrowing money from a client absent from unique circumstances, such as a familial relationship between the Financial Advisor and the client. There is also an exception if the client is a financial institution regularly engaged in the business of lending. The reason for this prohibition is clear—borrowing money from clients creates an immediate conflict of interest and can potentially lead to theft or conversion of client assets.
Excessive trading often occurs when a Financial Advisor puts his or her interests ahead of the clients and makes transactions solely for the purpose of generating commissions. Financial Advisors have a regulatory duty to recommend suitable investment strategies. One of the components of the suitability analysis is quantitative suitability.
Quantitative suitability requires a brokerage firm or financial advisor with actual or de facto control over a customer’s account to have a reasonable basis for believing that a series of recommended transactions – even if suitable when viewed in isolation – is not excessive and unsuitable for the customer when taken together in light of the customer’s investment profile. No single test defines excessive activity, but factors such as the turnover rate, the cost-equity ratio, and the use of in-and-out trading in a customer’s account may provide a basis for a finding that a member or associated person has violated the quantitative suitability obligation. Financial advisors have a legal and regulatory obligation to recommend only suitable investments that are appropriate for their clients’ needs and objectives. Their employing brokerage firm has a legal and regulatory obligation to supervise the Financial Advisors’ sales practices and dealings with clients. To the extent any of these duties are breached, the customer may be entitled to a recovery of his or her investment losses.
The Wolper Law Firm represents investors nationwide in securities litigation and arbitration on a contingency fee basis. Matt Wolper, the Managing Principal of the Wolper Law Firm, is a trial lawyer who has handled hundreds of securities cases during his career involving a wide range of products, strategies and securities. Prior to representing investors, he was a partner with a national law firm, where he represented some of the largest banks and brokerage firms in the world in securities matters. We can be reached at (800) 931-8452 or by email at mwolper@wolperlawfirm.com.