A New York Stock Exchange arbitration panel awarded a California investor $3.1 million after finding a New York-based investment company made unauthorized trades and failed to protect a large stock position.
The investor, Jay Hoge, won $2.1 million in compensatory damages and another $1 million in punitive damages from Sands Brothers.
Hoge, a technology services employee, gave his money to Sands, which professed to be able to manage the funds and hedge the large position.
The firm improperly traded in Hoge’s account and failed to protect Hoge’s large stake in Finisar Corp., a California based technology company which had bought his firm with stock.
“A brokerage firm has a duty to seek consent before any trade is placed and to always put the client’s interests first,” said Philip M. Aidikoff , who tried the case.
Sands’ Hoovers profile describes the firm as offering “an array of investment products and services to help the rich get richer.”