FINRA Investigation: Daniel G. Maughan – Financial West Group, Los Angeles, CA

According to a FINRA complaint filed on August 14, 2019, FINRA’s Department of Enforcement alleges that broker Daniel G. Maughan, while associated with Financial West Group, allegedly churned and excessively traded a customer’s trust account from October 2010 through January 2015.  Since the complaint was just filed by FINRA, Maugham will obviously have an opportunity to respond and deny FINRA’s allegations.

FINRA specifically alleges in the complaint that Maughan executed approximately 1,648 trades, with a principal value of all purchases and sales purportedly in excess of $70 million, in his client’s account. The annualized cost-to-equity ratio (the percentage the account had to appreciate to break even) was allegedly 21.06, FINRA claims.

FINRA further alleges that Maughan’s trading was quantitatively unsuitable and purportedly generated commissions and costs totaling approximately $841,000 while allegedly causing the account to incur realized and unrealized losses of approximately $812,000, according to FINRA’s complaint.

During the same time period, Maughan also allegedly recommended qualitatively unsuitable trades in the same account involving:  options and non-traditional Exchange-Traded Funds, according to FINRA.

According to his FINRA BrokerCheck report, Maughan was reportedly registered with Financial West Group in Los Angeles, CA from May 2010 through August 2017. His broker report indicates 4 settled customer complaints reportedly filed against Maughan between 2001 and 2015.  Allegations include breach of fiduciary duty, negligence, unauthorized trading and unsuitability among others.

For more information on FINRA’s investigation, see FINRA case #20170547552.

Investigating Potential Lawsuits

The White Law Group is investigating potential lawsuits regarding the liability that his former employers may have for failure to properly supervise Maughan.

When brokers violate securities laws, such as making unsuitable recommendations or churning client accounts, the brokerage firm they are working with may be liable for investment losses through FINRA Arbitration.

Brokerage firms that fail to monitor the business activities of their employees may be liable for investment losses due to negligent supervision for the misconduct of their employees.

The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Franklin, Tennessee.

We represent investors in FINRA arbitration claims in all 50 states, including California. Our attorneys have recovered millions of dollars from many brokerage firms in the past.

If you are concerned about your investments with Daniel G. Maughan, please call the securities fraud attorneys at The White Law Group at 888-637-5510 for a free consultation.

For more information on The White Law Group, and its representation of investors, please visit http://whitesecuritieslaw.com.