FINRA Sanctions Merrill Lynch Broker Robert Spencer Gerstein
On July 20, 2023, Robert Spencer Gerstein, based in Boca Raton, Florida, was subject to an AWC (Acceptance, Waiver, and Consent) by FINRA (Financial Industry Regulatory Authority). As part of this agreement, Gerstein faced several sanctions:
- Deferred Fine: He was assessed a deferred fine of $5,000.
- Suspension: Gerstein was suspended from association with any FINRA member in all capacities for a period of six months.
- Restitution: He was ordered to pay $129,496, plus interest, in deferred restitution to customers.
The allegations against Gerstein revolved around his engagement in short-term trading of securities that were meant to be held long-term. He recommended and executed unsuitable short-term trades in Class A mutual fund shares held by customers of his member firm, despite an average intended holding period of 198 days. He also advised customers to engage in short-term trading of other products like UITs and Market Linked Investments (MLIs) that his firm considered should be held long-term. Gerstein lacked a reasonable basis to believe that these recommended transactions were suitable for the customer accounts.
Furthermore, Gerstein’s actions led to his firm maintaining inaccurate books and records. He marked certain order tickets as “unsolicited” for sale transactions in customer accounts when, in reality, he had solicited each of these transactions.
As a result of the AWC, Gerstein’s suspension took effect from August 7, 2023, and will continue until February 6, 2024. This case was recorded under FINRA Case #2019061789202.
If you lost money because of Gerstein’s investment recommendations, please contact Banks Law Office today.