SEC Wins Jury Trial Against Broker Charged With Defrauding Customers

Jurors in Manhattan federal court today returned a verdict in the Securities and Exchange Commission’s favor against a broker who was charged in January 2017 with fraud for excessively trading customer accounts using a trading scheme that generated hefty commissions for the broker but significant losses for his customers. A second broker, also charged in the same complaint for engaging in the same fraudulent practices, admitted to his misconduct and settled with the SEC on the eve of trial. The SEC’s evidence at trial showed that the broker, Donald J. Fowler, while registered with J.D. Nicholas & Associates Inc., a now-defunct broker-dealer located in Syosset, New York, engaged in fraud when he deployed an in-and-out trading scheme that was unsuitable for his customers in order to generate large commissions for himself.