Ex-Morgan Stanley Broker Involved In 20 Broker Fraud Claims

The Latest Customer Claim Accuses Investment Advisor of Excessive Trading

Once again, an investor is blaming former Morgan Stanley stockbroker, Michael Frank Paesano, for their investment losses. These latest allegations involve excessive trading.

Although Paesano is no longer a registered broker, he is still a registered investment advisor and he may be affiliated with Axiom Investment Management. During Paesano’s 26 years in the industry, there have been more than twenty customer complaints brought against him. While four of these cases were denied, all of the other resolved claims have led to significant settlements, including one for $1.2M.

Paesano Has A History Of FINRA Arbitration Claims

Michael Paesano was with Morgan Stanley from 2011 to 2017. Before that, he worked at 12 other broker-dealers.

According to Paesano’s BrokerCheck record, these are the Financial Industry Regulatory Authority) FINRA arbitration claims brought by investors that were settled or are still pending:

7/2020 and 6/2020: These two most recent customer disputes allege excessive trading between 2014 and 2017 by Paesano.

11/2019: Another, still pending customer claim seeks $3.6M in damages. The claimants contend that they were encouraged by him to borrow from their liquidity access line in their Morgan Stanley brokerage account to make outside investments.

3/2018: Once again, excessive trading and selling away were alleged. This investor claim was settled for $145K. In a different, unrelated customer dispute, the claimant alleged fraud and breach of contract and received a nearly $90K settlement.

10/2017: One customer received a $1.2M settlement over excessive trading allegations against Paesano. A $58K settlement was paid to a different customer who alleged broker fraud involving outside business investments.

2008 – 2016: Eleven settlements were paid to investors in cases naming Michael Paesano. Their allegations included unsuitability, misrepresentation, breach of fiduciary duty, breach of contract, conflicts of interest, failure to supervise, unsuitable recommendations, negligence, structured product fraud, and/or overconcentration. Nine of the settlements were in the six-figures including those for: $475K, $400K, $245K, $225K, $200K, $170K, $155K, $124K, and $117K, respectively.

Prior to Morgan Stanley, Michael Paesano was a UBS broker. Before that, he was an MBSC broker, but that firm fired him in 2016. He also has been a registered representative with Mellon Financial Markets, McDonald Investments, Blaylock Partners, Schonfeld Securities, Fimat USA, Nomura Securities (NMR), and other broker-dealers.

Broker Fraud Law Firm Fighting For Investors

Our stockbroker fraud lawyers at Shepherd Smith Edwards and Kantas (SSEK Law Firm) are speaking to customers who suffered losses while working with ex-Morgan Stanley registered representative, Michael Paesano. He is just one of a number of current and former Morgan Stanley brokers that we are investigating on behalf of investors.

There is another ex-Morgan Stanley rep. Kevin Gunnip, who was accused of excessive trading in multiple customers’ accounts. The broker-dealer just agreed to pay $949K for inadequately supervising him.

Also, former Morgan Stanley broker Justin Amaral allegedly defrauded a number of investors. Morgan Stanley settled with Massachusetts over the harm Amaral caused to customers, again due to its alleged lack of supervision for $382K.

There have been other Morgan Stanley representatives accused of broker fraud and negligence. Contact SSEK Law Firm today. You may have ground for a FINRA arbitration claim to recover your losses.