What You Need to Know
- The ex-broker allegedly traded excessively without written authorization in the accounts of multiple clients.
- He also allegedly forged client signatures on account documents.
- He then did not cooperate with a FINRA investigation, which is a surefire way to be barred from the industry.
A broker formerly with the Advisor Group member firm SagePoint Financial and Cambridge Investment Research was barred by the Financial Industry Regulatory Authority after he allegedly traded without written authorization in the accounts of multiple clients, including one who had died, and then didn’t cooperate with FINRA’s investigation, the industry self-regulator said Monday.
Without admitting or denying FINRA’s findings, David John Melilli signed a FINRA letter of acceptance, waiver and consent Friday, barring him from associating with any FINRA member firm in all capacities. FINRA signed the letter Monday.
Melilli became a general securities representative through his association with SagePoint in January 2010, according to his report on FINRA’s BrokerCheck website.
But on Aug. 21, 2019, SagePoint filed a Form U5 Uniform Termination Notice on behalf of Melilli. A reason was not given on his report or in the AWC letter, and Advisor Group could not immediately be reached for comment Tuesday.
What Your Peers Are Reading
Melilli became registered with FINRA as through his association with Cambridge in September 2019. But on Feb. 4, 2020, Cambridge filed a Form U5 terminating Melilli’s association with the firm. According to a disclosure on his report dated Jan. 23, 2020, Cambridge said he was dismissed for placing “discretionary trades without authority.”
Cambridge did not immediately respond to a request for comment on Melilli’s being barred.
Among the other disclosures on Melilli’s BrokerCheck report are two complaints from clients who in 2020 alleged he made unauthorized trades in their accounts. One requested damages of $140,000 and the other $5,000. Both cases are still pending, according to BrokerCheck.
Another client filed a complaint last year, alleging that Melilli “made risky investments that were not fully understood” and “management fees may not have been assessed correctly.” That complaint was denied.