Galvin Legal is launching an investigation on behalf of investors who may have suffered losses investing with David Mitchell Elias. If you suffered losses investing with David Mitchell Elias, then Galvin Legal may be able to help you recover your losses in a Financial Industry Regulatory Authority (“FINRA“) arbitration claim.
David Mitchell Elias (CRD# 4209235)
As of April 19, 2018, David Mitchell Elias’s FINRA BrokerCheck Report contains the following:
FINRA has barred this individual from acting as a broker or otherwise associating with a broker-dealer firm.
Disclosure Events
3 Regulatory Event(s)
2/12/2018 – Regulatory – Final
Initiated By FINRA
Allegations: Without admitting or denying the findings, Elias consented to the sanction and to the entry of findings that he was sole owner, control person, and chief compliance officer (CCO) of his member firm, and he operated the firm while it was in a net capital deficiency causing it to violate SEC and FINRA rules. The findings stated that Elias was aware the firm repeatedly conducted a securities business while in a net capital deficiency. As the firm’s sole owner and control person, Elias was responsible for ensuring the firm’s compliance with its net capital requirement and for its continuation of business while in a net capital deficiency. In addition, FINRA cited the firm for net capital deficiencies in its examination report. Notwithstanding the specific notice of the deficiencies as provided by FINRA’s examination report, Elias repeatedly conducted a securities business through the firm while in a net capital deficiency. The firm continued filing Financial and Operational Combined Uniform Single (FOCUS) Reports showing net capital deficiencies through the termination of its registration. The findings also stated that Elias made impermissible withdrawals in willful violation of Section 15(c) of the Securities Exchange Act of 1934 and Exchange Act Rule 15c3-1(e)(2). On a Friday, Elias contributed $35,000 to the firm to rectify a net capital deficiency of $30,479 that the firm had reported the same day. The following Monday, Elias withdrew $35,000 from the firm without seeking permission from FINRA. On February 19, 2015, Elias deposited $23,000 to rectify a net capital deficiency of $18,109. The firm’s FOCUS report for the quarter April 1 to June 30, 2015, reported a net capital deficiency of $68 as of June 30, 2015. On July 21, 2015, Elias withdrew $3,500 from the firm without seeking permission from FINRA, and the firm ended the month with a net capital deficiency of $68,741. The findings also included that Elias failed to supervise a clerk who was subject to a plan of heightened supervision because he was subject to a statutory disqualification. Elias failed to implement the part of the heightened plan of supervision that called for another individual, as the clerk’s interim supervisor to supervise the clerk in Elias’s absence. In addition, Elias failed to review the clerk’s email correspondence as required by the heightened supervisory plan. Elias never informed the interim supervisor about his potential role in the clerk’s heightened supervision. FINRA found that Elias failed to appear and continue providing testimony for a FINRA on-the-record testimony during the investigation of his violations.
Resolution: Acceptance, Waiver & Consent(AWC)
Sanctions: Bar
Registration Capacities Affected: all capacities
Duration: indefinite
Start Date: 2/12/2018
Sanctions: Respondent understands that this settlement includes a finding that he willfully violated Section 15(c) of the Securities Exchange Act of 1934 and Rules 15c3-1(e)(2), and that under Article III, Section 4 of FINRA’s By-Laws, this makes Respondent subject to a statutory disqualification with respect to association with a member.
Regulator Statement: Matter No. 2014039444404 includes Matter No. 20150467916
10/10/2017 – Regulatory – Final
Initiated By NYSE American LLC
Allegations: Elias was named a respondent in an NYSE American LLC complaint alleging that although he was responsible for ensuring that his member firm was operating with sufficient net capital, he operated the firm while it was in a net capital deficiency. The complaint alleges that as the firm’s sole owner and control person, Elias was responsible for ensuring its compliance with its net capital requirement and for its continuation of business while in a net capital deficiency. In addition, the Trading and Financial Compliance Examinations Section (“TFCE”) of FINRA cited the firm for net capital deficiencies in its examination report dated June 9, 2015. Notwithstanding the specific notice of the deficiencies as provided by TFCE’s exam report, Elias repeatedly conducted a securities business through the firm while in a net capital deficiency through October 16, 2015. The complaint also alleges that during this period, Elias impermissibly withdrew capital from the firm. On Friday, January 30, 2015, Elias contributed $35,000 to the firm to rectify a net capital deficiency of $30,479 that the firm had reported the same day. The following Monday, on February 2, 2015, Elias withdrew $35,000 from the firm. On February 19, 2015, Elias deposited $23,000 to rectify a net capital deficiency of $18,109. The firm’s FOCUS report for the quarter April 1 to June 30, 2015, reported a net capital deficiency of $68 as of June 30, 2015. On July 21, 2015, Elias withdrew $3,500 from the firm, and the firm ended the month with a net capital deficiency of $68,741. Elias did not seek permission from the NYSE to make the $35,000 withdrawal in February 2015 or the $3,500 withdrawal in July 2015. The complaint further alleges that Elias failed to adequately supervise, or ensure adequate supervision of, an employee of the firm who was subject to a plan of heightened supervision due to the employee’s disciplinary history. In addition, the complaint alleges that during the investigation that gave rise to these proceedings, Elias refused to appear and continue to provide testimony as requested.
Resolution: Decision & Order of Offer of Settlement
Sanctions: Bar
Registration Capacities Affected: All capacities
Duration: Indefinite
Start Date: 1/29/2018
10/10/2017 – Regulatory – Final
Initiated By NYSE National, Inc.
Allegations: Elias was named in a complaint alleging that he operated the NYSE member firm that he owned and controlled, and was the chief compliance officer of, while it was in a net capital deficiency. The complaint alleges that Elias was aware, from at least May 31, 2014, through February 18, 2015, and from May through October 2015, the firm repeatedly conducted a securities business while in a net capital deficiency. The firm attributed the deficiencies to a substantial loss in May 2014 and decreases in income thereafter. As the firm’s sole owner and control person, Elias was responsible for ensuring the firm’s compliance with its net capital requirement and for the firm’s continuation of business while in a net capital deficiency. In addition, the firm was cited for net capital deficiencies in an examination report dated June 9, 2015. Notwithstanding the specific notice of the deficiencies as provided the exam report, Elias repeatedly conducted a securities business through the firm while in a net capital deficiency through October 16, 2015. Elias caused the firm to violate Section 15(c) of the Securities Exchange Act of 1934 and Rule 15c3-1 and NYSE Rule 4110(b)(1). Elias also impermissibly withdrew capital from the firm without seeking permission from the NYSE to make the withdrawals. As a result, Elias willfully violated Section 15(c) of the Securities Exchange Act of 1934 and Rule 15c3-1. Elias failed to adequately supervise, or ensure adequate supervision of, a firm employee who was subject to a plan of heightened supervision due to the employee’s disciplinary history. In addition, during the investigation that gave rise to these proceedings, Elias refused to appear and continue to provide testimony as requested.
Resolution: Decision & Order of Offer of Settlement
Sanctions: Bar
Registration Capacities Affected: All capacities
Duration: Indefinite
Start Date: 1/29/2018
Current and Previous Registrations
11/23/2001 – 04/14/2016 DME SECURITIES, LLC (CRD# 112584) NEW YORK, NY
FINRA requires brokerage firms to conduct due diligence on investments and to conduct a suitability analysis when recommending securities to a customer that takes into account the customer’s knowledge and experience. Brokerage firms that fail to conduct adequate due diligence or that make unsuitable recommendations can be held responsible for the customer’s losses in a FINRA arbitration claim.
If you suffered losses investing with David Mitchell Elias and would like a free consultation with a securities attorney, then please call Galvin Legal at 1-800-405-5117.
Galvin Legal is a national securities arbitration, mediation, fraud, and investor protection law practice. For more information on Galvin Legal, please visit www.galvinlegal.com or call 1-800-405-5117.