Erez Law is currently investigating former Western International Securities, Inc. broker Christopher Kennedy (CRD# 4498061) regarding options losses. He was registered with Western International Securities, Inc. in Woodland Hills, California, from December 2019 to September 2021, when he was terminated regarding, “Clients have alleged unauthorized options trading and failure to adhere to discretionary options sales orders.” Previously, he was registered with Spartan Capital Securities, LLC in New York, New York, from July to December 2019, with Western International Securities, Inc. in Tarzana, California, from 2017 to 2019, and with Financial West Group in Tarzana, California, from 2009 to 2017.
In September 2023, FINRA opened an investigation into the broker alleging that he churned and excessively traded accounts of customers. The FINRA complaint alleges that he “used his control over these accounts to direct an excessive series of transactions in each account that generated commissions for his own benefit at the customers’ expense. Kennedy directed trades representing net trading of more than $350 million in the customer accounts. Each month, Kennedy made trades representing net trading of more than $6.9 million per account or approximately 13 times the average account value. Kennedy’s trading for the customers resulted in annualized cost-to-equity ratios ranging from 27 percent to 39 percent for an average cost-to-equity ratio of more than 31 percent across all their accounts.” The customers allegedly lost more than $2.3 million in value from their accounts and paid more than $715,000 in trading costs and margin interest, including more than $595,000 in commissions.
The FINRA complaint also alleges that he “made fake account statements to hide the results of his trading from two customers, a husband and wife co-trustees of a family trust account. Over six months, Kennedy prepared and sent six fake account statements to the customers from his personal email. Kennedy supplemented these fake account statements by making a series of other false statements to the married couple inflating their account value. For example, Kennedy sent a fake account statement to the married couple purporting to show an ending balance of $5.2 million and a gain in value of over $3 million. In fact, under Kennedy’s control the account had lost nearly all of its value and only approximately $160,000 in value remained in the account.”
Finally, FINRA found that during the course of its investigation, he lied to the agency in response to its requests for information and on-the-record testimony by falsely denying preparing any fake account statements for the married couple and falsely claimed that his personal email had been hacked and that an imposter had sent all but one of the fake account statements.
In November 2023, FINRA barred him after he “consented to the sanction and to the entry of findings that he churned and excessively traded customer accounts as a registered representative of his member firm. The findings stated that Kennedy used his control over these accounts to direct an excessive series of transactions that generated commissions for his own benefit at the customers’ expense.”
Christopher Kennedy Customer Complaints
He has been the subject of nine customer complaints between 2008 and 2022, according to his CRD report. The most recent complaints are regarding:
June 2022. “Claimant alleges misrepresentation, suitability of transactions, and breach of fiduciary duty in the management of the account.” The customer sought $120,694 in damages, and the case was settled for $75,000. The complaint took place while he was registered with Western International Securities, Inc., and it was regarding common and preferred stocks and options losses.
May 2022. “Losses sustained by virtue of unauthorized trading.” The case was settled for $375,000. The complaint took place while he was registered with Western International Securities, Inc.
March 2022. “Engaged in extensive and unauthorized trading without clients knowledge or consent.” The customer is seeking $2,453,936.28 in damages, and the case is currently pending. The complaint took place while he was registered with Western International Securities, Inc., and it was regarding options and stock losses.
January 2022. “Client alleged through counsel on August 24, 2021, that Kennedy had begun in February 2021 to use margin without approval of the Client family accounts and that during the week of July 26th Kennedy had engaged in improper options trading for Client. Claimant allegations, include but not limited to, Breach of Fiduciary duty.” The customer sought $5,424,035 in damages, and the case was settled for $3,800,000. The complaint took place while he was registered with Western International Securities, Inc., and it was regarding options losses.
December 2021. “Client alleges breach of fiduciary duty, unauthorized trading, and breach of contract.” The customer sought $245,000 in damages, and the case was settled for $125,000. The complaint was regarding options losses. The complaint took place while he was registered with Western International Securities, Inc., and it was regarding options losses.
November 2021. “Customer expressed concern of the handling of his account.” The case was settled for $36,870.52. The complaint was regarding options losses. The complaint took place while he was registered with Western International Securities, Inc., and it was regarding options losses.
November 2021. “Claimant raised concerns regarding misrepresentation and negligence in handling accounts. ”The case was settled for $40,731.26. The complaint was regarding options losses. The complaint took place while he was registered with Western International Securities, Inc., and it was regarding options losses.
November 2021. “Claimant alleged breach of contract, fiduciary duty, and negligence in handling the account.” The customer is seeking $375,000 in damages, and the case is currently pending. The complaint was regarding options losses. The complaint took place while he was registered with Western International Securities, Inc., and it was regarding options losses.
September 2021. “The Client has alleged that his account lost 300K over the past few months and that Kennedy was trading without authority from the client or supervision from Western.” The case is currently pending. The complaint was regarding options losses.
September 2021. “Client alleged through counsel that Kennedy forged and denied access to client account statements in order to hide allegedly improper trading in the Client’s account occurring from December 2020 through August 2021, including options trading conducted in the last week of July 2021 which led to these allegations.” The case was settled for $2,760,000. The complaint took place while he was registered with Western International Securities, Inc., and it was regarding options losses.
Pursuant to FINRA Rules, member firms are responsible for supervising a broker’s activities during the time the broker is registered with the firm. Therefore, Western International Securities, Inc. may be liable for investment or other losses suffered by Christopher Kennedy’s customers.
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If you have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies on a contingency fee basis.
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