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WARNING! Impending Investigation: DENNY DARMODIHARDJO, ROCKWELL GLOBAL CAPITAL, and EXCESSIVE TRADING

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15
Oct

WARNING! Impending Investigation: DENNY DARMODIHARDJO, ROCKWELL GLOBAL CAPITAL, and EXCESSIVE TRADING

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WARNING!  Impending Investigation:  DENNY DARMODIHARDJO, ROCKWELL GLOBAL CAPITAL, and EXCESSIVE TRADING

Denny Darmodihardjo, Rockwell Global Capital, and Excessive Trading

 

Have you lost money investing with financial advisor Denny Darmodihardjo of Fort Lauderdale, Florida?  We are currently investigating allegations made against Denny Darmodihardjo, a financial advisor who previously worked with Rockwell Global Capital.  FINRA, the Financial Industry Regulatory Authority, brought a complaint against Darmodihardjo, alleging that he excessively traded (or churned) his customer’s accounts and recommended the unsuitable use of short-selling securities and the use of margin.  To settle these claims, Darmodihardjo agreed to pay a  $25,000 fine and to be suspended from the securities industry for 18 monts.

 

According to FINRA’s allegations, from 2009 to 2011, Denny Darmodihardjo excessively traded or churned his customers’ accounts.  FINRA also alleged that customers’ accounts had turnover ratios as high as 38.71.  Additionally, the cost-equity ratios ranged from 31.04% to 108.91%.

 

Excessive Trading or Churning

 

One of the most common ways to determine whether the account was excessively traded or churned is to determine the annual turnover ratio.  This ratio shows how often the securities in the account are bought or sold within a year.  Authority has held that an annual turnover of 4 or more is a “presumption” of churning, and an annual turnover of 6 or more is a “conclusion” of churning.  Thus, if the accounts had turnovers over 6, then there would be a conclusion that there was churning or excessive trading.

 

Another way to determine whether there was excessive trading is the cost equity ratio.  This ratio takes the commissions generated by the trading, divided by the average value of the account.  This ratio essentially determines the returns that an account needs to make just to break even. Thus, an account with a cost-equity ratio of 31% would need to earn 31% just to break even from all the costs of trading.

 

Denny Darmodihardjo was a registered representative and financial advisor of Rockwell Global Capital from 2007 to August 2015.  He worked at branch offices in Fort Lauderdale, Florida.  Darmodihardjo has been the subject of at least thirteen customer complaints and four federal tax liens.  He was also previously fined by FINRA for $2,500 in 2014 for failure to properly disclose his tax liens.

 

Broker-dealers like Rockwell Global Capital, Inc. have a responsibility to adequately supervise all representatives who are registered through their firm, including investments sold by their registered representatives.  Broker-dealers also must take steps to ensure that their financial advisors follow all securities rules and regulations, such as to refrain from excessively trading a customer’s account.  When broker-dealers fail to adequately supervise their registered representatives, they may be liable for investment losses sustained by customers.

 

Israels & Neuman PLC is a securities and investment fraud law firm with offices in the Seattle area and Denver, Colorado.  We represent investors in FINRA arbitration proceedings in all 50 states, including investors in the Miami area and South Florida.  Attorney David Neuman is licensed to practice law in the State of Florida.  Our attorneys have represented over one thousand investors against many brokerage firms in the past, including Rockwell Global Capital, LPL Financial, Merrill Lynch, Morgan Stanley, Smith Barney, Stifel Nicolaus & Company, UBS Financial Services, Oppenheimer, Charles Schwab, Wells Fargo Advisors, Ameriprise Financial Services, Raymond James Financial Services, ProEquities, Securities America, National Securities Corp., and many others.

 

Have you lost money with Denny Darmodihardjo or Rockwell Global Capital ?   

 

                Contact Israels & Neuman, PLC for a Free Consultation

                Denver Office: (720) 599-3505

                Seattle Office: (206) 795-5798

 

Click to view:  Darmodihardjo FINRA AWC

Click to view:  Darmodihardjo BrokerCheck 10.15.15

 

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DENVER: (720) 599-3505

SEATTLE: (206) 795-5798


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