Justin Deiter is a financial advisor with Spartan Capital. Please contact us if you believe Mr. Deiter mishandled your investments. We are a firm that represents investors to recover losses sustained due to financial advisor fraud or negligence.
In February 2025, Justin Deiter came under regulatory scrutiny for making excessive trades. Excessive trades benefit the advisor at the expense of the investor. FINRA, the financial industry regulatory authority, suspended Deiter for six months. FINRA is the regulator that oversees securities brokerages.
Between February 2020 and March 2022, Deiter recommended to two of his investors a series of trades that were excessive. As a result, Deiter willfully violated the Best Interest Obligation under the Securities Exchange Act of 1934 (Regulation BI) and various FINRA Rules.
As of June 30, 2020, securities brokerages and their financial advisors are required to comply with Regulation Bl. Regulation BI requires a brokerage or its financial advisor, when making a recommendation of any securities transaction or investment strategy involving securities (including account recommendations) to a retail investor, act in the best interest of that investor at the time the recommendation is made, without placing the financial or other interest of the brokerage or financial advisor ahead of the interest of the investor. Reg BI’s Care requires brokerages and their associated persons to exercise reasonable diligence, care, and skill to, among other things, have a reasonable basis to believe that a series of recommended transactions is not excessive and is in the investor’s best interest in light of the retail customer’s investment profile.
Between February 2020 and March 2022, Deiter excessively traded the accounts of two investors. One was a senior. Deiter’ s trading resulted in high turnover rates and cost-to-equity ratios that exceeded the traditional guideposts of six and 20 percent, respectively, for even the most aggressive investors, as well as significant losses, as set forth below.
Customer A, then a 49-year-old merchandiser, opened an account at Spartan with Deiter. She was a conservative investor who relied on Deiter’ s advice and always followed his recommendations. As a result, Deiter exercised de facto control over the account. Between February 2020 and December 2021, Deiter recommended 32 transactions in Customer A’s account resulting in an annualized turnover rate of 7 and an annualized cost-to-equity ratio of 34%. Deiter’s trading in Customer A’s account generated $19,792 in commissions and caused $25,291 in realized losses.
Customer B, then an 89-year-old retiree, opened an account at Spartan with Deiter. His investment objective was speculation. Between June 30, 2020, and March 2022, Deiter recommended 28 transactions in Customer B’s account resulting in an annualized turnover rate of 14 and an annualized cost-to equity ratio of 35%. Deiter’s trading in Customer B’s account generated $28,264 in commissions and caused $33,363 in realized losses.
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