Martin Earl Brooks formerly of Cetera

If you have suffered losses investing with Martin Earl Brooks, formerly of Cetera, due to investments that were unauthorized please call 1-866 817-0201.

FINRA, the regulator that oversees securities brokerages alleges that On April 5, 2016, without prior written authorization, Martin Earl Brooks exercised discretionary trading authority for five different Firm customers, by purchasing shares in a real estate fund for each customer, in violation of NASD Rule 2510(b) and FINRA Rule 2010.

Brooks also violated FINRA Rules 4511 and 2010 by mismarking the five investment order tickets to assert that the trades were “unsolicited.”  This misrepresents that the trades were the idea of the investor instead of “discretion exercised” and “solicited.”

It is important that all investors approve investments prior to being made.  The failure to do so can lead to excessive commissions by the broker and trades that benefit the broker instead of the investor.

If written discretionary authority is given heightened review by the broker’s supervisors is given over the trades.  If the broker makes trades without written or prior authority, the trades made are often poor investments that pay heightened commissions.  This is often the case with real estate investments – the types of investments Martin was trading.

NASD Rule 2510(b) provides that no member or registered representative shall exercise any discretionary power in a customer’s account unless such customer has given prior written authorization to a stated individual or individuals and the account has been accepted by the member, as evidenced in writing by the member or the partner, officer or manager, duly designated by the member.

FINRA Rule 2010 provides that a member, in the conduct of its business, shall observe high standards of commercial honor and just and equitable principles of trade. A violation of NASD Rule 2510 is also a violation of FINRA Rule 2010.

Cetera, the employer of Martin, maintained policies and procedures that prohibited representatives from exercising any discretionary power in placing an order for the purchase or sale of securities for a client without first obtaining written approval from the client.

On April 5, 2016, Brooks exercised discretionary trading authority for five different Firm customers, by purchasing shares in a real estate fund for each customer, without written authorization, and without prior written acceptance of the accounts as discretionary from Cetera.

The full history of Mr. Brooks can be found on FINRA’s Brokercheck.

 

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