• August 28, 2023
• Wedbush Securities

Jonathan Way (CRD# 1126849) was a previously registered broker at Wedbush Securities Inc., in Napa, CA.

Broker’s Background

He entered the securities industry in 1983 and previously worked for Wedbush Securities, Inc.; Ryan, Beck & Co., LLC; Gruntal & Co LLC; Moors & Cabot, Inc.; Dakin Securities Corporation; Rodman & Renshaw Inc.; Smith Barney Inc.; Dean Witter Reynolds Inc.; Drexel Burnham Lambert Incorporated; L.F Rothchild & Co. Incorporated; and Dean Witter Reynolds 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 June 2023, without admitting or denying the findings, Jonathan Way consented to the sanctions and to the entry of findings that he refused to provide documents and information requested by FINRA in connection with an investigation. The findings stated that this matter originated from FINRA’s review of a Form U5 filed by Jonathan Way’s member firm, that stated that he was permitted to resign while under internal review for potential sales practice violations. Johnathan Way responded to FINRA’s initial request, however, he ultimately refused to produce the information and documents requested. Accordingly, Jonathan Way was barred indefinitely.

To view the full disciplinary action, click here.

In addition, Jonathan Way has been the subject of five other disclosures, which include the following:

• December 2022—“Allegations consist of excessive, unauthorized, and unsuitable trading.” The customer dispute is still pending. The damage amount requested is $1,000,000.
• May 1999— “Ohio Division of Securities ordered a sanction denying Securities Salesman License Application.” Allegations state “not of good business repute.”
• October 1995—“UNSUITABLE TRANSACTION,UNAUTHORIZED TRADES, FAILURE TO PROVIDE A PROSPECTUS TO CLIENT. CUSTOMER SOUGH $150,000 FROM DEAN WITTER AND $250,000 FROM SMITH BARNEY. (CUSTOMER ALLEGED THAT ALTHOUGH HER ACCOUNT WAS PROFITABLE, THE PROFITS SHOULD HAVE EARNED A 25% RATE OF RETURN OVER ONE YEAR. SHE CLAIMED DAMAGES OF $298,458.” The damage amount requested was $150,000, and the customer dispute was settled for $85,000.
• October 1995—” Permitted to Resign from SMITH BARNEY INC.”
• June 1989— “CUSTOMER CLAIMED THAT HE SUSTAINED LOSSES FROM THE PURCHASE OF LF ROTHSCHILD DEBENTURES AND COMMON STOCK.” Customer dispute settled for $75,000.

For a copy of Jonathan Way’s 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.

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.

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.

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.