FINRA barred former Financial West Group (Los Angeles, CA) broker Sean J Waters for excessive trading in his elderly client's individual and IRA accounts with reckless disregard for his senior citizen customer's interests. FINRA found that Waters' churning cost his customer approximately $115,000 in excess commissions, markup/markdowns and fees, as well as $88,000 in cumulative losses.
According to FINRA's report, Waters (CRD #4414180) engaged in churning and excessive/unsuitable trading in an elderly Financial West Group investor's accounts from 2013 through 2016, though the story began in 2010, when this senior customer, with limited investment experience, transferred her individual brokerage account to Financial West with Waters serving as registered representative.
Waters joined Financial West Group in December 2010 after brief stints with Arque Capital in Scottsdale, AZ, and Southwest Securities in Beverly Hills. Southwest Securities had discharged Waters in April 2010 for violating firm policies/procedures by accepting a loan from a client.
As for Waters' senior citizen client at Financial West, the report states that in 2011, her husband died and that she subsequently retired in 2012 at the age of 69, relying on Social Security benefits and savings, including the Financial West Group accounts. In 2013, she rolled over her IRA to Financial West, specifying investment objectives of capital appreciation and income with a moderate risk tolerance, giving Waters de facto control over the individual and IRA accounts, including control over trading decisions.
FINRA wrote that shortly after assuming control, Waters excessively traded the accounts by effecting 1,000 trades totaling nearly $4 million in purchases and sales during the relevant period, including in-and-out trades wherein a broker buys and sells the same security multiple times over a short period, which FINRA noted "is an indicia of excessive trading."
According to the AWC, these transactions generated approximately $115,000 in commissions and other fees, and $88,000 in cumulative losses out of the $150,000 Waters' elderly client initially transferred to Financial West.
After leaving Financial West Group in April 2017, Waters joined Newbridge Securities Corporation (with an indicated employer location of Hemet, CA, and branch in Boca Raton, Florida) before subsequently leaving that firm in February 2018. Waters also lists an outside business activity as an insurance agent/financial advisor in which he sells variable life insurance policies (d/b/a "Sean J. Waters" with an office in downtown Los Angeles).
If you have invested with former Financial West Group broker Sean J. Waters or with any financial adviser or registered representative whose abuse of discretion, excessive/unsuitable trading, or churning has generated exorbitant fees and commissions, produced trading losses in your account, or has otherwise proven harmful to your interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.