Jury Rules Against Broker in Excessive Trading Case
A Manhattan federal court jury ruled in favor of the SEC in its case against a broker charged two years ago with excessive trading, the regulator says.
The SEC aimed to prove that Donald Fowler, while registered with the now-defunct Syosset, N.Y., broker-dealer J.D. Nicholas & Associates, engaged in an excessive trading scheme unsuitable for his clients for the purpose of generating commissions, according to a press release from the regulator.
The SEC also alleged that Fowler failed to do due diligence to determine whether such trading could end up being profitable for the client.
The commissions Fowler charged apparently would have required returns of 142% just for the clients to break even, according to the press release.
The jury found Fowler liable on all counts, including violating federal anti-fraud provisions, the SEC says.
The court will determine the remedies against him at a later date, according to the regulator.
A second broker charged in the same 2017 SEC complaint as Fowler, Gregory Dean, admitted to his misconduct earlier this month and agreed to pay disgorgement of $253,881, $50,521 in prejudgment interest, and a $253,881 civil penalty, the SEC says.
Both Fowler and Dean began their financial services industry careers in 2005 and joined J.D. Nicholas in 2007, according to their BrokerCheck profiles.
They left the firm in 2014 and joined Worden Capital Management, where they’re both still registered, according to BrokerCheck.