Northeast Securities Inc. to pay $1.76 Million in FINRA Award

Northeast Securities Inc. to pay $1.76 Million for customer’s bond losses.

According to Investment News, a FINRA arbitration panel has awarded a former customer of Northeast Securities Inc. $1.76 million in compensatory damages in a case involving bond transactions. The claimant, Timothy McLaughlin, had sought damages of $3 million.

McLaughlin charged the firm and three of its brokers with common law fraud, churning, breach of fiduciary duty, misrepresentation, negligence, gross negligence, negligent misrepresentation, failure to supervise and violation of FINRA and SEC rules. The case involved corporate bonds, the Financial Industry Regulatory Authority Inc. said in its award document.

Northeast Securities Inc. is a registered broker and dealer, which provide information about administrative procedures, events, and home office news in the securities and financial services industry to enhance communication between the home office and outside sales force. Northeast Securities Inc. was founded in 1989 and is based in New York, according to Bloomberg.

The company must pay interest on the award at the rate of 9% per year from March 1, 2012 until the award is paid. The firm and its brokers are also responsible for paying McLaughlin’s expert witness fees of $33,840.

The FINRA arbitration panel denied requests from the three brokers named in the case to have their records in FINRA’s Central Registration Depository (CRD) expunged.

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This information, which is publicly available on FINRA’s website has been provided by The White Law Group.

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