Fired RBC Customer Files Angry FINRA Arbitration

September 6, 2011

In a Financial Industry Regulatory Authority ("FINRA") Arbitration Statement of Claim filed in January 2011, Claimant Levy, who appeared pro se, sought at least $25,000 in damages arising out of various causes of action including churning and "the purchase of very small amounts of many stocks and then the sale of them shortly after and the buying of replacement stocks."  Marilyn Strauss Levy, Claimant, vs. RBC Capital Markets LLC and Greg Buckner, Respondents (FINRA Arbitration 11-00349, August 30, 2011).

Clearly Erroneous

The sole FINRA Arbitrator denied the Claimant's claims with the added slap of a finding that the claims were "clearly erroneous and not supported by the evidence,"  As such, the FINRA Arbitrator recommended the expungement of the matter from Respondent stockbroker Buckner's Central Registration Depository records ("CRD").  

Good Show Versus the No-Show

The FINRA Arbitrator commended Respondents for having  "presented clear and cogent evidence to disprove Claimant's aforementioned allegations, while Claimant affirmatively declined to appear at the hearing."  Obviously, it's always a good thing to put on a clear and cogent case - and not appearing at a hearing is simply not calculated to elicit a favorable result.

Given Claimant's absence from the hearing, the FINRA Arbitrator appears to have largely relied upon Respondents' Statement of Answer and Respondent Buckner's testimony.

The Statement of Answer calculated that Claimant paid $2,100 in total fees and maintained an average account equity of $373,574.00, which Respondents' characterized as a "very low commission to equity ratio."  Further, a portfolio summary from October 2010 apparently confirmed that the asset mix of Claimant's account complied with her stated balanced/conservative growth investment objective.

Panic Attacks

Respondent Buckner testified that there were few sales in Claimant's account, and that the overall turnover analysis demonstrated a "very low" ratio.  Moreover, Respondent Buckner denied exerting any control over the account and stated that Claimant had approved all transactions, received timely confirmations without objection - with the notable exception of the disputed sale of DuPont stock. 

In the case of the DuPont sale, it was asserted that Claimant went to Respondent Buckner's office and "confronted him and the manager, claiming that she had not authorized the sale. The FINRA Arbitrator concluded that Respondents acted immediately to rescind the sale, making the Claimant whole. 

Respondent Buckner insisted during his hearing testimony that the disputed DuPont sale had been authorized.  The FINRA Arbitrator noted that:

In fact. Respondents produced a letter written by Claimant to Mr. Buckner, time stamped July 2010, thanking Mr. Buckner for his "time and patience" and stating, "I'll try and keep the panic attacks down."

From the Painted Corner

It must have been quite the the lonely corner into which the FINRA Arbitrator felt painted. A no-show Claimant. Respondents' apparently thorough and credible statistical analysis. Respondent Buckner's persistent and insistent defense of his reputation and conduct. There just doesn't appear to have been much in the way of an off-set from Claimant's side of things. 

A Final Fillip

Given the lopsided presentation of the case, the FINRA Arbitrator delivered  a compelling rationale for dismissing the charges:

Since Ms. Levy chose not to appear, I had no oral evidence from her to contradict Mr. Buckner's testimony. I could not question her to assess her or Mr. Buckner's veracity. Beyond her written allegations which she reiterated in a letter to me and a memo to FINRA prior to the scheduled telephonic hearing, Claimant presented no evidence to support her very serious claims. All the evidence, as outlined above, supports Respondents' version of the events in question. Ms. Levy suffered no damages, but in fact, based on a written Account Profit/Loss Summary provided by Respondents, she enjoyed excellent returns on her account of 12%, which comprised of both dividends and asset growth.

I also relied on Mr. Buckner's oral testimony and his Broker Check Report to support his assertion that since becoming a broker in 1984, he has had no other complaints and no disciplinary actions.

The FINRA Arbitrator seems truly troubled by Claimant's charges and their apparent motivation.  In delivering one, last fillip, the Arbitrator offered this trenchant analysis of Claimant's case:

[s]he was upset at being 'fired" as a client by Respondents. Her case against Respondents appears to be one of retaliation and without merit. The lack of any concrete evidence to support her claims requires that they be rejected and that Mr. Buckner's clean record remain intact.