• August 27, 2024
• Sigma Financial Corp

Glenn Allen Donnell (CRD#:2239397) was a previously registered broker.

Broker’s History

He entered the securities industry in 1992 and previously worked with Chatfield Dean & Co., Inc.; Argus Securities, Inc.; Merrill Lynch, Pierce, Fenner, & Smith Incorporated; Investacorp, Inc.; Securities America, Inc.; and Sigma Financial Corporation.

Allegations of Misconduct

According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in August of 2024, without admitting or denying the findings, Donnell consented to the sanctions and to the entry of findings that he exercised discretion without prior written authorization by executing transactions in customer accounts. The findings stated that although the customers had given Donnell express or implied authority to exercise discretion in their accounts, none of the customers provided written authorization for him to exercise discretion. The findings also stated that Donnell caused two of his member firms to maintain inaccurate books and records by mismarking solicited trades as unsolicited. All of the trades were in marijuana securities, which trade over the counter. At one of the firms, Donnell untruthfully answered the firm’s direct inquiries about the solicited vs. unsolicited nature of the trades. While associated to another firm, Donnell marked the trades as unsolicited in order to avoid the firm’s trade system block on solicited over-the-counter trades.

As a result, Respondent consented to the imposition of the following sanctions:
• A four-month suspension from associating with any FINRA member in all capacities and
• A $12,500 fine.
For a copy of the disciplinary action details, click here.
In addition, Glenn Donnell has been the subject of three other customer disputes:
• August 2002—“ CLIENTS CLAIMS MARKET LOSS AND LACK OF SUITABILITY.” The damage amount requested is $36,000 and the customer dispute is still pending.
• January 2000—“ CUSTOMERS ALLEGE THAT THEIR FINANCIAL CONSULTANT MADE AN UNAUTHORIZED INVESTMENT WITH THEIR MONEY. CUSTOMERS ALSO ALLEGE THAT THIS INVESTMENT WAS UNSUITABLE FOR THEM. NO SPECIFIC DAMAGES ALLEGED.” The customer dispute was denied.
• June 1999—“ THE CUSTOMERS ALLEGE THAT MR. DONNELL ADVISED THEM THAT THEIR INVESTMENT WAS SAFE. CLAIMED DAMAGES OF 11,000.00. THIS OCCURRED AT MERRILL LYNCH.” The damage amount requested is $11,000 and the customer dispute is still pending.

We Help Investors Recover Investment Losses

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.

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.