Broker With Ties to Florida Fined and Suspended for Unauthorized Trades
Sylvester Knox (CRD#: 1625705) is a previously registered broker and actively registered investment advisor (RIA). From August of 2000 to February of 2017, Mr. Knox was employed at Merrill, Lynch, Pierce, Fenner & Smith. Subsequently, he served as a representative for FSC Securities Corporation.
In March of 2018, Sylvester Knox was sanctioned by the Florida Office of Financial Regulation for making material misstatements on securities compliance forms. He failed to disclose adverse information in violation of state law. At the time Mr. Knox was employed at FSC Securities Corporation.
On August 6th, 2020, the Financial Industry Regulatory Authority (FINRA) was fined $10,000 and suspended for nine months after allegations of unauthorized trading. Below, our Miami unauthorized trading attorneys explain the sanctions imposed against former Merrill Lynch broker Sylvester Knox.
Violation of Securities Industry Rules: Unauthorized Trading
Your financial advisor has a legal responsibility to get your permission before executing a trade. Brokers and investment advisors cannot make trades without getting your permission—even if they claim that they are acting in your best interests.
If you have a non-discretionary brokerage account, your financial advisor must get express permission for every individual transaction. They cannot execute any trades without your approval. If you have a discretionary account, your financial advisor does not need permission for every trade, but they still have a professional obligation to complete transactions that are fully consistent with your overall guidance.
In this case, FINRA’s investigators determined that former Merrill Lynch broker Sylvester Knox executed nearly $1.7 million in unauthorized trades in customer accounts. According to investigators, Mr. Knox exercised discretionary trading authority within these accounts. However, he never obtained the appropriate written authorization or approval from his clients. The violative conduct occurred between 2015 and 2017. Mr. Knox’s unauthorized trading violations primarily affected three customers.
FINRA Sanctions: Financial Advisor Sylvester Knox
After completing its investigation, FINRA determined that it was appropriate to impose sanctions against this financial advisor. Without admitting or denying any fault, Sylvester Knox agreed to accept the proposed penalties from regulators. He was fined $10,000 and suspended from the securities industry for nine months. The suspension is set to run until May 16th, of 2021.
You should always be able to rely on your broker to follow your guidance and instructions. Investors should have full confidence that their financial advisor will not make unapproved trades. If you suffered investment losses because of a broker’s unauthorized trading, you can hold them legally liable through a FINRA arbitration claim or securities litigation.
Call Our Florida Unauthorized Trading Lawyers for Help With Your Case
At Carlson & Associates, P.A., our Miami unauthorized trading attorneys have the skills, expertise, and knowledge to handle unauthorized trading claims. If you suffered losses due to a broker’s unauthorized transactions, we are more than ready to help. To arrange a completely confidential securities fraud claim, please call us today. We represent investors in Miami and throughout the wider region.