The Financial Industry Regulatory Authority (FINRA) announced today that it filed a complaint against New York brokerage firm John Thomas Financial and its CEO, Anastasios “Tommy” Belesis. FINRA charges the firm and Belesis with fraud in connection with the sale of America West Resources, Inc. (AWSR) common stock, intimidation of registered representatives, trading ahead, failing to provide best execution for customer orders, and various other violations. The complaint also names other John Thomas Financial employees: Michele Misiti, Branch Office Manager; John Ward, trader; Joseph Castellano, Chief Compliance Officer; and Ronald Vincent Cantalupo, Regional Managing Director. Blatant securities fraud of this nature undermines investors’ trust and confidence in the financial industry.
According to the FINRA complaint, John Thomas Financial and many of its customers owned America West Resources stock. According to FINRA, when the price of the stock soared by approximately 600 percent, John Thomas Financial sold most of its holdings for more than $1 million. At the same time, at least 15 John Thomas Financial customers also placed sell orders, but the brokerage firm and Belesis allegedly prevented the orders from being executed that day and some orders were not executed at all. America West Resources is now in bankruptcy and the customers’ investments are virtually worthless.
FINRA alleges that customers were lied to about their shares could not be sold, including that there was a problem with the clearing firm’s trading systems, there was insufficient volume on that day to fill the orders, and the shares could not be sold because they were restricted under the Securities Act of 1933.
FINRA further alleges that the accused claimed to have “lost” certain customer order tickets and replaced six of those tickets with falsified tickets dated the next day. Belesis and Misiti also are accused of misrepresenting Belesis’ role in the misconduct. In addition, FINRA charges John Thomas Financial, Belesis, Castellano, and Cantalupo with violating FINRA’s anti-intimidation rule by physically threatening, harassing, and assaulting brokers who disagreed with Belesis’ business practices, and threatening to ruin the brokers’ careers by improperly marking the brokers’ records.