- December 9, 2019
- Morgan Stanley
John A. Borsellino (CRD # 2006663) was a former Financial Advisor at Morgan Stanley in Stamford, CT. John Borsellini previously worked at Merrill Lynch.
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), on December 4, 2019, FINRA suspended John Borsellino for three months, fined him $5,000 and ordered disgorement totaling $23,931 for recommending unsuitable investments in customers’ accounts. Specifically, the findings that that “Borsellino recommended that customers purchase municipal bonds and non-municipal securities in their brokerage accounts, which caused the customers to incur upfront sales charges. In each instance, Borsellino transferred the security to the customer’s existing fee-based account shortly after purchasing it (generally within 90 days), and, in each instance, Borsellino could have purchased the securities in the fee-based account without any upfront sales charges. The upfront sales charges associated with the unsuitable purchases made in the customers’ brokerage accounts totaled approximately $58,000, all of which Borsellino’s member firm has reimbursed to his customers. Borsellino earned $23,931 in connection with the unsuitable recommendations. Borsellino lacked a reasonable basis to believe that the recommended securities purchases made in the customers’ brokerage accounts were suitable because he failed to exercise reasonable diligence and failed to consider the costs associated with the transactions.”
For a copy of the FINRA sanction, click https://www.finra.org/sites/default/files/fda_documents/2018057097301%20John%20A.%20Borsellino%20CRD%202006663%20AWC%20jm.pdf.
For a copy of John Borsellino’s CRD, click https://brokercheck.finra.org/individual/summary/2006663#disclosuresSection.
John Borsellino was “discharged” from Morgan Stanley relating to these allegations.
In addition, John Borsellino has been the subject of six customer complaints, including the following allegations:
• August 2006 – “CLIENT ALLEGES THAT FINANCIAL ADVISOR MADE UNSUITABLE INVESTMENT RECOMMENDATIONS AND MISREPRESENTATIONS.” The matter settled for $135,000.
• July 2006 – “CLIENT ALLEGES THAT FINANCIAL ADVISOR MADE UNSUITABLE INVESTMENT RECOMMENDATIONS AND FAILED TO FOLLOW INSTRUCTIONS.” The matter settled for $85,000.
• April 2002 – “IT IS ALLEGED THAT A MUTUAL FUND WAS PURCHASED WITHOUT THE CUSTOMER’S KNOWLEDGE.” The matter settled for $20,109.26.
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.
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