UNITED STATES SECURITIES AND EXCHANGE COMMISSION

The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("Exchange Act") against Dominic Tropiano ("Respondent"). On September 1, 2020, a judgment was entered by consent against Respondent, permanently enjoining him from future violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, in the civil action entitled U.S. Securities and Exchange Commission v. Dominic Tropiano, No. 1:20-cv-01911, in the United States District Court for the Northern District of Ohio. The Commission's complaint in that matter alleged that, between April 20, 2015 and June 5, 2016, in connection with the purchase and sale of securities, Tropiano executed trades without obtaining the customers' prior authorization. The complaint also alleged that Tropiano made unsuitable transactions in customers' accounts.

Order

Bar (Permanent)

broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or NRSRO

Indefinite

9/11/2020

Participating in any offering of a penny stock

Indefinite

9/11/2020

Penny Stock Bar

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

The Securities and Exchange Commission (the "Commission"), for its Complaint against Dominic A. Tropiano, alleges that Tropiano fraudulently engaged in unsuitable and unauthorized trading in the accounts of retail brokerage customers. Tropiano's fraud involved placing more than 500 trades involving complex securities called leveraged exchange traded funds ("ETFs"). The leveraged ETFs Tropiano purchased were high-risk securities intended to be traded daily by sophisticated investors and not held for periods longer than one day. However, Tropiano's customers were retail investors, including elderly ones, who had only moderate risk profiles and long-term investment objectives. Although the investments were unsuitable for his customers, Tropiano recommended and purchased leveraged ETFs for at least 40 retail customer accounts and held the leveraged ETFs in those accounts for weeks and, in some cases, months. Tropiano also fraudulently traded leveraged ETFs for certain customers without their authorization. As a result of Tropiano's fraudulent trading in leveraged ETFs, his customers sustained combined losses of more than $1 million. While his customers suffered, Tropiano profited by receiving at least $115,000 in "bonuses" and commissions generated from his trading. By reason of the foregoing, Tropiano violated Section l0(b) of the Exchange Act and Rule 10b-5 thereunder and Section 17(a) of the Securities Act.

Judgment Rendered

Injunction

disgorgement, prejudgment interest and civil penalty

FINRA

Without admitting or denying the findings, Tropiano consented to the sanction and to the entry of findings that he recommended transactions involving non-traditional exchange-traded funds (ETFs) to customers, without having a reasonable basis to believe those transactions were suitable for anyone, due to his lack of understanding of the unique risks, terms and features of the products. The findings stated that Tropiano's recommendations involving non-traditional ETFs were also unsuitable for those customers in light of their investment profiles, which included conservative investment objectives. The findings also stated that Tropiano caused non-traditional ETF transactions to be placed in customers' securities accounts without the customers' knowledge or consent, and in the absence of written or oral authorization for him to place such trades. The findings also included that Tropiano was not properly registered with FINRA while engaging in the securities business of a firm by soliciting the purchase and sale of non-traditional ETFs in the accounts of firm customers.

Acceptance, Waiver & Consent(AWC)

Bar (Permanent)

All Capacities

Indefinite

5/9/2019

No restitution was ordered, because Tropiano's member firm paid a total of $1,526,500 to its customers for losses suffered as a result of the non-traditional ETF transactions solicited by Tropiano while at the firm.

Claimants asserted numerous claims in connection with their 2015 and 2016 investments in leveraged ETFs made by another individual, including negligence, violations of FINRA rules, breach of fiduciary duty, unsuitability, unauthorized trading, and failure to supervise.

$250,000.00

Claimants asserted numerous claims in connection with their 2015 and 2016 investments in leveraged ETFs, including violations of the Ohio Securities Act and FINRA rules, negligence, unsuitability, failure to supervise, unauthorized trading, breach of fiduciary duty, and breach of contract.

$150,000.00

Claimants asserted numerous claims in connection with their 2015 and 2016 investments in leveraged ETFs, including violations of FINRA rules and recommendations, negligence, unsuitability, failure to supervise, and unauthorized trading.

$100,000.00

Client alleges the RR's recommendations to purchase various mutual funds totaling $446,740 from 2014 to March 2015 were unsuitable.

$120,000.00

$85,000.00

Claimants asserted numerous claims in connection with their 2015 and 2016 investments in leveraged ETFs, including violations of the Ohio Securities Act and FINRA rules, negligence, unsuitability, failure to supervise, unauthorized trading, breach of fiduciary duty, fraud, and breach of contract.

$800,000.00

Claimants asserted numerous claims in connection with their 2015 and 2016 investments in leveraged ETFs, including negligence, violations of FINRA rules, breach of fiduciary duty, unsuitability, unauthorized trading, and failure to supervise.

$330,000.00

Claimants asserted numerous claims in connection with their 2015 and 2016 investments in leveraged ETFs, including violations of the Ohio Securities Act and FINRA rules, negligence, unsuitability, failure to supervise, unauthorized trading, breach of fiduciary duty, and breach of contract.

$400,000.00

CLIENT ALLEGES THE REGISTERED REPRESENTATIVE MISREPRESENTED THE FEATURES OF A UNIVERSAL LIFE INSURANCE POLICY THAT WAS PURCHASED IN MAY OF 2012.

$36,000.00