Jim Schwartz (CRD #: 3043085), a barred New York broker formerly registered with Joseph Gunnar & Co., has three pending investor disputes on his record, according to his BrokerCheck record, accessed on February 8, 2021. Schwartz has also recently registered with Aegis Capital, as recently as 2016. There is lengthy list of disclosures that investors should review.

On March 9, 2020, an investor alleged that Jim Schwartz made unsuitable investment recommendations and breached his contract. The investor is seeking $341,386; the dispute is pending.

On January 13, 2020, an investor alleged that Schwartz executed excessive and unsuitable trades. The investor is seeking $200,000; the dispute is pending.

Barred by FINRA Following Allegations of Churning, Unsuitable Trades

FINRA barred Jim Schwartz on February 26, 2019, following allegations that he churned four investor accounts, made unsuitable trades, and executed unauthorized trades – including trades that he executed after an investor died. You can read a copy of the order here.

Excessive Trading

The order alleges that Jim Schwartz’s churning and excessive trading resulted in collective losses of more than $660,000. “Churning” refers to the execution of excessive trades for the sake of generating sales commissions.

Unauthorized Trading

None of the four investor accounts listed in the FINRA order were discretionary accounts, but the order alleges that Jim Schwartz treated them as if they were, making unauthorized purchases and sales without authorization.

Jim Schwartz made these trades on a “riskless principal basis,” allegedly to hide the costs associated with the trades. These costs included his commissions, which totaled $194,000. The hidden costs represented 90% of his investors’ trading costs.

Schwartz made risky, speculative investments, even though his investors specifically stated that they had conservative investment objectives.

Unauthorized Trading Allegations

Jim Schwartz has five other settled investor disputes alleging unauthorized trading. These disputes were collectively resolved for $1,788,286.36.

Unsuitable Investment Recommendations

Schwartz has also settled two investor disputes regarding unsuitable investment recommendations. These disputes were resolved for $962,000.

Financial Disclosures

On May 10, 2016, Jim Schwartz became the subject of a tax lien for $15,667.

On June 3, 2017, Schwartz discharged a bankruptcy.

Jim Schwartz has passed the Series 63 Uniform Securities Agent State Law Examination, the Securities Industry Essentials Examination, and the Series 7 General Securities Representative Examination. He was formerly a registered broker in New York, New Jersey, Florida, and Texas.

During his 18 years in the securities industry, Schwartz has worked at 12 firms:

  • Joseph Gunnar (CRD #: 24795)
  • First Standard Financial Company (CRD #: 168340)
  • Aegis Capital Corp (CRD #: 15007)
  • John Thomas Financial (CRD #: 40982)
  • Paulson Investment Company (CRD #: 5670)
  • Rockwell Global Capital (CRD #: 142485)
  • Gunnallen Financial (CRD #: 17609)
  • Maxim Group (CRD #: 120708)
  • Investec Ernst & Company (CRD #: 266)
  • First Montauk Securities (CRD #: 13755)
  • Salomon Grey Financial Corporation (CRD #: 43413)
  • First American Equities (CRD #: 31091)

If Jim Schwartz was your broker and you have questions about your investments, don’t hesitate to contact the securities attorneys of Fitapelli Kurta. Call (877) 238-4175 or email info@fkesq.com for a free case consultation with a securities attorney.

Leave a Comment