- November 28, 2022
- Aegis Capital Corp
M.B. Schreiber (CRD#: 103260) is a registered Broker at Aegis Capital Corp. in Red Bank, NJ.
He entered the securities industry in 1982 and previously worked for National Securities Corporation; Newbridge Securities Corporation; Summit Brokerage Services, Inc.; First Montauk Securities Corp.; The Concord Equity Group, LLC; and Mid-State Securities Corp.
Current And Past Allegations Of Conduct Leading To Investment Loss
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in October 2022, FINRA sanctioned M.B. Schreiber with civil and administrative penalties and fines of $5,000 and suspension from all capacities for three months beginning November 21, 2022 and ending February 20, 2023.
The FINRA sanction states, “Without admitting or denying the findings, Schreiber consented to the sanctions and to the entry of findings that he exercised discretion without written authorization. The findings stated that Schreiber exercised discretionary trading authority when he executed securities transactions in customer accounts. The customers did not provide Schreiber with prior written authorization for his use of discretion, and his member firm did not approve the accounts as discretionary. The findings also stated that Schreiber caused the firm to make and preserve inaccurate and incomplete books and records. Schreiber improperly marked 181 order tickets as “unsolicited” when in fact he had solicited them because he had recommended the transactions to the customers, causing the firm to maintain inaccurate books and records with respect to these trades. In addition, Schreiber used his personal email address to communicate with firm customers about securities transactions in their firm accounts. Schreiber did not disclose his use of his personal email to the firm, or provide the firm with copies of his electronic correspondence with the customers, causing the firm to maintain incomplete records of his business-related communications. Schreiber also falsely stated on the firm’s annual compliance questionnaires that he did not exercise discretionary authority in any customer accounts, and that he did not use a personal email address for business-related communications.”
For a copy of the FINRA sanction, click here.
In addition, M.B. Schreiber has been the subject of six additional disclosures, including the following:
- March 2022 — “Time frame: Unspecified. Claimant alleges unsuitability and breach of contract.” The customer dispute is pending.
- February 2020 — “TIME FRAME: UNSPECIFIED. UNSUITABILITY, UNAUTHORIZED TRADING, CHURNING, MISREPRESENTATION, NEGLIGENCE, BREACH OF CONTRACT, BREACH OF FIDUCIARY DUTY, OMISSION OF MATERIAL FACTS.” The customer dispute was settled for $40,000.
- March 2010 — “NASD RULES 2110, 2370-SCHREIBER BORROWED MONEY FROM ONE OF HIS CUSTOMERS IN VIOLATION OF HIS FIRM’S PROCEDURES. THE FIRM SPECIFICALLY PROHIBITS REPRESENTATIVES BORROWING MONEY FROM CUSTOMERS. MOREOVER, SCHREIBER DID NOT INFORM THE FIRM OF THIS LOAN, WHICH WAS REPAID.” FINRA sanctioned M.B. Schreiber with a civil and administrative penalty/fine of $10,000 and suspended him from all capacities for 60 days beginning April 5, 2010 and ending June 3, 2010. For a copy of the disciplinary action, click here.
- October 2007 — “PERMITTED THE HOLDING OF CUSTOMER’S STATEMENTS WITHOUT WRITTEN INSTRUCTIONS FROM CUSTOMER. ACCEPTED A CUSTOMER’S BENEFICIARY DESIGNATION TO A VARIABLE ANNUITY WITHOUT DISCLOSING AND OBTAINING APPROVAL FROM FIRM.” M.B. Schreiber was discharged from Summit Brokerage Services.
- July 2002 — “CUSTOMER ALLEGES UNSUITABILITY IN THE HANDLING OF THEIR ACCOUNT.” The customer dispute was closed with no action.
- September 2000 — “UNSUITABILITY & MISREPRESENTATION.” The customer dispute was settled for $80,000.
For a copy of M.B. Schreiber’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.
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