Acting Attorney General Matthew J. Platkin and the Division of Consumer Affairs today announced that the New Jersey Bureau of Securities has taken action against an Atlantic Highlands investment adviser and advisory firm, as well as an unregistered investment adviser representative whom they employed despite knowing he had been barred from the securities industry.
The Bureau’s action includes a total assessment of $800,000 in civil penalties, revocations of the investment adviser and advisory firm’s registrations, and a cease-and-desist order against the unregistered investment adviser representative.
In a Summary Penalty and Revocation Order issued by the Bureau today, Acting Bureau Chief Amy G. Kopleton found that Steven Gluckstein and his advisory firm, Seaview Global Advisors LLC (Seaview), employed Anthony Calascione from approximately 2017 through 2021 and allowed him to solicit clients and provide investment advice, despite knowing that he was barred from the securities industry by FINRA and could not be registered.
The Bureau found that Calascione, who currently resides in Staten Island, New York, had acted as an investment adviser representative without registration and the Bureau ordered him to immediately cease and desist from violating the Securities Law.
Calascione is also liable to pay civil penalties in the amount of $300,000.
“Circumventing the law to maximize profits is unlawful, and it comes with serious consequences,” said Acting Attorney General Platkin.
“The conduct of these individuals shows a clear disregard for their clients, and we will continue pursuing violators to protect investors.”
Gluckstein and Seaview, through Gluckstein, breached their fiduciary duty to investors by allowing Calascione to provide investment advisory services, recommending unsuitable trading to inexperienced clients, and failing to inform clients that Calascione was unregistered and barred by FINRA, according to the Bureau’s findings.
One of those clients was a recently divorced woman in her sixties (Client A), who needed assistance with her investments which consisted of approximately $32,000 of her retirement money.
In September 2018, Client A became a client of Seaview, and Calascione recommended unsuitable stocks and options without adequately inquiring into her objectives and limited financial situation, according to the Bureau.
The Bureau found that Gluckstein, Seaview, and Calascione failed to advise Client A of the risks associated with those strategies and investments.
And due to overconcentration and unsuitable trading, Client A’s individual account went from an opening balance of $24,484.91 to a balance of $0 in less than one year and the balance of Client A’s second investment account decreased from an initial balance of $8,188.84 to $533.46 by May 2020.
Additionally, the Bureau found that Gluckstein, Seaview, and Calascione violated the Securities Law by engaging in conduct that included:
- Failing to establish required policies and procedures designed to protect investors
- Failing to make and keep required books and records
- Violating the privacy policy and appropriate standards of security and confidentiality
- Failing to safeguard the privacy of clients’ information
“Investors have a right to expect the investment advisers they hire to comply with the law and industry standards,” said Howard Pine, Acting Director of the Division of Consumer Affairs.
“New Jersey investors should have faith in the professionals managing their investments. I commend the Bureau for their action today to ensure these individuals cease operating.”
Calascione was registered with the Bureau as an agent of several broker-dealers from 1997 through 2004. In November 2016, FINRA barred Calascione from associations with any FINRA member.
Calascione is also the subject of two regulatory actions, three criminal disclosures, and fourteen customer complaints, among other disclosures, reported to the Central Registration Depository.
“In addition to investment advisers’ fiduciary duty to their clients, they have a basic responsibility to ensure they establish policies and procedures reasonably designed to prevent violations of the Securities Law,” said Amy G. Kopleton, Acting Chief of the Bureau of Securities.
“We will not let unscrupulous professionals undermine the integrity of New Jersey’s financial industry.”
Deputy Attorney General Isabella T. Stempler of the Securities Fraud Prosecution Section in the Division of Law’s Affirmative Civil Enforcement Practice Group is representing the Bureau in this matter. The Bureau’s investigation was handled by Investigators Judith Keilp and Rosemary Gonzalez.