FINRA announced on Monday it has filed a complaint against John Thomas Financial of New York, and its CEO, Anastasios “Tommy” Belesis, charging fraud in connection with the sale of common stock, physical intimidation of registered representatives, trading ahead, failing to provide best execution for customer orders and various other violations. The charges come on the heels of similar action by the SEC in March.
Belesis appeared in the film Wall Street 2: Money Never Sleeps.
The complaint also names Michele Misiti, branch office manager; John Ward, trader; Joseph Castellano, chief compliance officer; and Ronald Vincent Cantalupo, regional managing director.
Also, the complaint charges JTF, Belesis, Castellano and Cantalupo with violating FINRA’s anti-intimidation rule by physically threatening (including threatening to have them “run over”), harassing and assaulting registered representatives who have disagreed with Belesis’ business practices, and threatening to ruin the registered representatives’ financial careers by improperly marking their industry records.
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JTF and many of its customers owned America West Resources (AWSR) common stock as a result of participation in the company’s private financings. According to the complaint, on Feb. 23, 2012, the price of AWSR common stock, which at the time was thinly traded on the OTC Bulletin Board, spiked higher, by approximately 600%, opening at 28 cents per share, peaking at $1.80 per share and eventually closing the day at $1.29 per share. On the same day, JTF sold 855,000 shares, the majority of its proprietary position in AWSR, reaping proceeds of more than $1 million.
The complaint alleges that while JTF sold its shares at the height of the price spike, the firm received at least 15 customer orders to sell more than 1 million shares, yet only entered one of these orders for execution on Feb. 23, 2012.