Former Lebenthal Financial Services Broker Robert Nyilas Barred Indefinitely by FINRA After Refusing to Participate in Investigation into Unsuitability Allegations
Robert Nyilas (CRD#: 1030273) is a previously registered Broker. He entered the securities industry in 1982 and previously worked for Lebenthal Financial Services, Inc.; Advisory Group Equity Services, Ltd.; Source Capital Group, Inc.; Gilford Securities Incorporated; Gruntal & Co.; LLC; Herzfeld & Stern, Inc.; E.F. Hutton & Company, Inc.
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in September 2021, FINRA sanctioned Robert Nyilas, barring him from all capacities, indefinitely, beginning September 14, 2021. The FINRA sanction states, “Without admitting or denying the findings, Nyilas consented to the sanction and to the entry of findings that he refused to provide documents and information requested by FINRA in connection with its investigation into whether he made unsuitable securities recommendations in customer accounts.”
For a copy of the FINRA sanction, click here.
Robert Nyilas has no previous disciplinary history.
For a copy of Robert Nyilas’s FINRA BrokerCheck, click here.
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 agee, 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.
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