History Of Jeffrey D. Stanga
Stanga first entered the securities industry in August 2014 when he associated with FMN
Capital Corporation. He became registered as a General Securities Representative (GSR)
with FINRA through his association with FMN Capital in October 2014. Stanga is
currently registered as a GSR with FINRA through his association with FMN Capital.
Jeffrey D. Stanga Report
This matter originated from an arbitration Statement of Claim filed against Stanga by a
non-firm customer in December 2017 alleging investment-related claims that pre-dated
Stanga’s association with a member firm.
Stanga Failed to Fully Disclose the Nature of His Outside Business Activities
FINRA Rule 3270 provides that “[n]o registered person may be an employee,
independent contractor, sole proprietor, officer, director or partner of another person, or
be compensated, or have the reasonable expectation of compensation, from any other
person as a result of any business activity outside the scope of the relationship with his or
her member firm, unless he or she has provided prior written notice to the member, in
such form as specified by the member.” A violation of FINRA Rule 3270 is also a
violation of FINRA Rule 2010.
From February through June 2014, prior to his association with FMN Capital, Stanga
sold a private placement offering of membership units in connection with Company A, a
residential real estate flipping business. Stanga provided written notice of Company A to
FMN Capital on his Form U4, describing his involvement as an “investor, gives
advice/opinions on buying/fixing/selling residential homes,” but failed to fully disclose
his role as “manager,” and that Company A was an investment-related business, as
required by FINRA Rule 3270.
Therefore, Respondent violated FINRA Rules 3270 and 2010.
Stanga Participated in Private Securities Transactions Without Firm Approval
FINRA Rule 3280, and its predecessor, NASD Rule 3040, requires that prior to
participating in a private securities transaction, a person associated with a member firm
shall provide written notice to his or her firm, “describing in detail the proposed
transaction and the person’s proposed role therein and stating whether he has received or
may receive selling compensation in connection with the transaction.”
FINRA Rule 3280 defines a private securities transaction as “any securities transaction
outside the regular course or scope of an associated persons’ employment with a
member,” including securities which are not registered with the Securities and Exchange
Commission. A violation of NASD Rule 3040 and FINRA Rule 3280 is also a violation
of FINRA Rule 2010.
Prior to his association with FMN Capital, Stanga sold promissory notes to investors in
connection with a real estate brokerage firm, Company B. After registering with FMN
Capital, and between March 2015 to March 2017, Stanga participated in eight private
securities transactions totaling $1,160,000 by facilitating the renewals of the Company B
promissory notes he sold to investors prior to his association with FMN Capital. Stanga
facilitated the promissory note renewals for four investors (one of whom was a firm
customer) by acting as an intermediary between the investors and Company B. Stanga
notified the investors of the opportunity to renew their promissory notes, reviewed draft
documents, negotiated interest rates, and sent signed promissory notes to Company B on
behalf of the investors. Stanga received $28,359 in referral fees in connection with these
private securities transactions. Stanga did not provide a detailed written notice to FMN
Capital prior to participating in these private securities transactions and did not obtain
written permission from FMN Capital to participate in the transactions, as required by
NASD Rule 3040 and FINRA Rule 3280.
Therefore, Respondent violated NASD Rule 3040 (for conduct before September 21,
2015) and FINRA Rule 3280 (for conduct on and after September 21, 2015) and FINRA
Penalties, Punishments & Sanctions
a 12-month suspension from associating with any FINRA member in all
a $10,000 fine
disgorgement of $28,359, plus interest, as described below
Respondent agrees to pay the monetary sanction upon notice that this AWC has been
accepted and that such payment is due and payable. Respondent has submitted an
Election of Payment form showing the method by which he proposes to pay the fine
Respondent specifically and voluntarily waives any right to claim an inability to pay, now
or at any time after the execution of this AWC, the monetary sanction imposed in this
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Disgorgement of financial benefits received is ordered to be paid to FINRA in the amount
of $28,359, plus interest at the rate set forth in Section 6621(a)(2) of the Internal Revenue
Code, 26 U.S.C. § 6621 from April 17, 2015 until the date this AWC is accepted by the
National Adjudicatory Council (NAC). Payment of disgorgement shall be made within
120 days after the date of the notice of acceptance of the AWC.
Jeffrey D. Stanga Review
Between October 2014 and December 2017, Stanga failed to fully disclose the nature of
his outside business activities, in violation of FINRA Rules 3270 and 2010. Between
March 2015 and March 2017, Stanga also participated in private securities transactions
without providing the required written notice to, or receiving written approval from FMN
Capital, in violation of NASD Rule 3040 and FINRA Rules 3280 and 2010.
Who is the Financial Adviser?
A financial adviser or advisor is a professional who offers financial services to clients based on their financial situation. In several countries, financial advisors have to finish specific training and register with a regulatory body to provide advice.
How To Spot A Fraud Finance Advisor (Infographic)
Help For Victims Of Jeffrey D. Stanga
If you have lost funds because of misrepresentation, unsuitable investment, or unsuitable investment strategy from Jeffrey D. Stanga. Then you can take legal action and get justice. Fraud, Malpractice & dereliction of duty should not be taken lightly, especially in this industry. We highly suggest that you notify authorities or seek legal action if your financial advisor or brokerage firm fails to abide by FINRA’s rules are regulations.
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Financial advisors are regulatory & legally obligated to suggest (recommend) the most suitable investments/investment strategies to their clients. Their suggestions should have their client’s best interests and should be appropriate for their client’s goals and needs. Similarly, the brokerage firm which hires financial advisors also has a regulatory & legal obligation to keep a close watch and supervise their Financial Advisors’ practices & behavior. They need to make sure that the financial advisor is not being manipulative or having an unreasonable bias towards certain investments. If the financial advisor and/or the brokerage firm breaches these duties, then the client/customer may be entitled to a full or partial recovery of their losses.
Financial advisors need to have the interest of their clients when giving suggestions related to investments and investment strategies. Reasonable basis suitability requires the advisor to do their best to analyze & identify the risks and rewards associated with their suggested investment and/or investment strategy.