According to a recent Letter of Acceptance, Waiver and Consent (AWC) with the Financial Industry Regulatory Authority (FINRA), former Morgan Stanley registered broker Thomas Niles has broken securities laws and internal firm rules. Allegedly, between July 2012 and December 2014, Niles engaged in an unsuitable pattern of short-term trading of Unit Investment Trusts (UITs) in 148 customer accounts. UITs are investment companies that offer shares of a fixed portfolio of securities in a one-time public offering, and terminate on a specified maturity date. Niles’ recommendations caused the customers to incur unnecessary sales charges and were unsuitable in view of the frequency and cost of the transactions. For this misconduct, Niles was fined $5,000 and suspended for three months from the industry.
A broker like Thomas Niles has a duty to do his due diligence on every security he recommends or sells to his clients, and to take into account the customer’s age, net worth, investment sophistication and investment risk tolerance, among other factors before doing so. If he does not, Morgan Stanley may be liable for investment losses on a contingency fee basis in the FINRA arbitration forum.
Thomas Francis Niles was previously registered with Merrill Lynch in New York, New York from September 1992 until November 1995, Salomon Smith Barney in New York from November 1995 until April 2000, Prudential Securities in New York from April 2000 until July 2003, Wachovia Securities in Latham, New York from July 2003 until March 2009, Morgan Stanley in Saratoga Springs, New York from March 2009 until June 2009 and Morgan Stanley in Saratoga Springs from June 2009 until September 2015. He is currently registered with Janney Montgomery Scott in Saratoga Springs, and has been since September 2015. This is according to his online, FINRA BrokerCheck report.
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