the Financial Sector Regulatory Authority decided to prohibit a dismissal Morgan Stanley financial adviser who allegedly defrauded his professional athlete clients.
Morgan Stanley fired the adviser, Daryl Mathew Cohenin March 2021 regarding allegations related to his “activities with outside clients and transactions not disclosed or approved by Morgan Stanley and use of an unapproved platform to engage in inappropriate communications with customers,” according to its BrokerCheck filing.
Cohen was part of Morgan Stanley’s Global Sports Entertainment Group, the division that caters to athletes and entertainers, according to the law firm. Erez’s Law, who is investigating Cohen. According to public documents cited by the law firm, two former National Basketball Association players, Chandler Parson and Courtney Leeare suing Morgan Stanley over allegations that payments were made without approval of their accounts between 2017 and 2019. The athletes – who are seeking $5 million in damages – alleged they were encouraged, presumably by Cohen, to obtain a line of credit cash access for real estate and life insurance policies, says Erez Law.
Finra says it has begun investigating allegations of possible conversion and misuse of client funds, prompted by several client arbitration claims against Morgan Stanley who allege Cohen mishandled their accounts and was selling non-company-approved securities through loans to third parties.
On Dec. 30, 2021, an expanded Finra Hearing Panel ruled that Cohen should be banned on Feb. 16 if no further action is taken, based on his refusal to provide information requested by Finra, according to BrokerCheck. .
In addition to the bar, Finra ordered Cohen to pay a hearing fee of $2,039.08, according to the self-regulator.
Cohen entered the financial services industry 24 years ago when he registered with Merrill Lynchthen made a trip to Wells Fargo and came to Morgan Stanley in 2015, according to BrokerCheck.
Cohen has nine customer complaints on file, including two settled, one denied, one closed, one resulted in an award and the rest are still pending. The complaints allege misrepresentation, payments without prior approval, mismatch and other violations, according to BrokerCheck.
Finra’s decision to ban Cohen was first reported by AdvisorHub.
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