April 2019 to June 2020, Unsuitable trading

$361,000.00

FINRA

Without admitting or denying the findings, Platnico consented to the sanctions and to the entry of findings that he engaged in unauthorized and unsuitable trading in a customer's account. The findings stated that Platnico recommended a high-risk options trading strategy in a joint account held by a customer and her late husband. Platnico communicated about that strategy regularly with the customer's husband. Following the death of the customer's husband, however, the customer and Platnico spoke by telephone once, and he continued to execute the trading strategy in the account. Platnico did not contact the customer before placing the options transactions at issue, nor did he have discretionary trading authority in the customer's account. In addition, although Platnico occasionally called the customer's son to discuss the options trading strategy employed in the customer's account, he never obtained written trading authorization from the client for her son to direct the trading in the account. Moreover, Platnico did not conduct reasonable diligence to confirm that the options strategy continued to be suitable for the customer's investment profile. In fact, it was not, given that the strategy involved a substantial risk of loss, the customer was retired, had limited investment knowledge and experience, and the customer had only a moderate risk tolerance. Platnico placed at least 100 unsuitable and unauthorized options trades in the customer's account, which caused her to suffer substantial losses.

Acceptance, Waiver & Consent(AWC)

Civil and Administrative Penalty(ies)/Fine(s)

$10,000.00

Suspension

All Capacities

Nine Months

6/5/2023

3/4/2024

The AWC does not require that Platnico pay restitution because the customer settled with Platnico's member firm an arbitration claim related to the conduct at issue in this AWC.

Alleges unsuitable investment strategy from approximately June 2019 to March 2020.

$332,000.00

$65,000.00

Alleges unsuitable investment strategy from approximately December 2019 to March 2020

$370,000.00

$30,000.00

Claimant alleges representative engaged in unsuitable and unauthorized options trading in Claimant's account

$1,460,000.00

$182,500.00

Clients claimed they had not been contacted about closing out a short position, and the trade was therefore unauthorized. From 12/24/2018 to 12/24/18.

$95,690.00

$95,690.00

The customer is a physician, who is a sophisticated and affluent investor. On December 24, 2018, at approximately 12:45 PM (EST), just 15 minutes before the close of a volatile market on the shortened Christmas Eve trading day, management instructed me to liquidate numerous short option positions due to margin deficiencies. Mistakenly, this account was traded with all the other accounts on margin call mainly because the accounts typically traded in tandem as a group. The client chose not to notify me or the firm for over a two week period, allowing the error to become substantial.

Client alleges that strategy being employed in his account was misrepresented to him and is unsuitable. Time period is 4/1/2018 - 12/31/2018.

$190,463.42

$50,000.00

The customer is a sophisticated, highly educated and experienced investor, who was pre-qualified by my firm and its supervisors to engage in the highest level of options trading. I did not misrepresent the option strategy to him. I know that the option strategy employed in his account was suitable for him because I met with him and personally explained the risks of the strategy to him and he authorized each trade used in the strategy with full knowledge of all market risks, including especially the risk of loss which could be caused by market volatility.