- December 21, 2022
- Arrive Capital Markets
Mirsad Muharemovic (CRD#: 3122589) is a previously registered Broker.
He entered the securities industry in 1998 and previously worked for Arrive Capital Markets; Cape Securities, Inc.; J.P. Turner & Company, LLC; American Express Financial Advisors, Inc.; IDS Life Insurance Company; Newbridge Securities Corporation; Milestone Financial Services, Inc.; Seaboard Securities, Inc.; and Gilford Securities, Inc.
Current And Past Allegations Of Conduct Leading To Investment Loss
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in December 2022, FINRA sanctioned Mirsad Muharemovic with a civil/administrative penalty/fine of $5,000, an order to pay restitution of $211,643, and a 9-month suspension beginning December 19, 2022 and ending September 18, 2023. The FINRA sanction states, “Without admitting or denying the findings, Muharemovic consented to the sanctions and to the entry of findings that he engaged in excessive and unsuitable trading, including using margin, in customer accounts. The findings stated that Muharemovic recommended that his customers place trades in their accounts – nearly all of which were executed using margin – and the customers routinely accepted his recommendations. Muharemovic’s recommendations resulted in annualized turnover rates ranging from 5.71 to 19.26 and annualized cost-to-equity ratios ranging from 30.12 percent to 74.25 percent. As a result of Muharemovic’s unsuitable recommendations, his customers lost approximately $237,823, and paid approximately $211,643 in commissions, fees, and margin interest.”
For a copy of the FINRA sanction, click here.
In addition, Mirsad Muharemovic has been the subject of three customer complaints, including the following:
- August 2019 — “Churning, Excessive Trading, Unsuitability.” The customer dispute was settled for $115,000.
- July 2018 — “Unsuitability.” The customer dispute was settled for $72,500.
- December 2000 — “HIGH PRESSURE SALES TACTICS, MISREPRESENTATION, EXCESSIVE MARGIN, ETC.” The customer was awarded damages of $35,000.
For a copy of Mirsad Muharemovic’s FINRA BrokerCheck, click here.
We Help Investors Recover Investment Losses
Financial advisers 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 Advisers’ 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 adviser 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 adviser 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 adviser 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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