• December 20, 2020
• WestPark Capital

Nicholas Palumbo (CRD #1069948) was a registered broker with Park Avenue Securities LLC from 1999-2020 in Armonk, NY. Nicholas Palumbo was in the securities industry from 1983-2020 and also worked for Guardian Investor Services Corporation, SMA Equities, Inc., and First Investors Corporation.

On April 17, 2020 Nicholas Palumbo was permitted to resign from Park Avenue Securities LLC following allegations “The RR was permitted to resign while under investigation for failure to disclose an unapproved private securities transaction and soliciting soliciting clients to invest in same.”

Often times, Financial Advisors who participate in private securities transactions are said to be “selling away.” FINRA strictly prohibits financial advisors from “selling away” or selling securities and investments to clients that are not offered by the brokerage firm with which they are employed. For example, it is illegal and a violation of industry rules for a financial advisor to recommend or even suggest that a client invest in the financial advisor’s own business or a business operated by his or her friends or family. It is not necessary that the financial advisor earn any compensation for recommending an outside investment.

The purpose behind this prohibition is to ensure that a financial advisor only offers to sell securities that have been vetted by his or her employer brokerage firm through a rigorous due diligence process. Most brokerage firms have an approved list of investments, products, and research that can be provided or made available to clients. Any deviation by the financial advisor from the approved product list may constitute selling away.

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, P.A. represents investors nationwide in securities litigation and arbitration on a contingency fee basis. Matt Wolper, the Managing Principal of the Wolper Law Firm, P.A., 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.