Erez Law Investigates Claims Related to Tom Abel Puentes and Morgan Stanley

Erez Law is currently investigating former Morgan Stanley financial advisor Tom Abel Puentes (CRD# 1713812) regarding time and price discretion in customer accounts to purchase municipal bonds. Puentes was registered with Morgan Stanley in Langley Washington from 2009 to 2014 when he was terminated due to concerns relating to his use of discretion without written authorization in connection with municipal bond transactions. Puentes has been registered with Kestra Investment Services, LLC in Woodland Hills, California since 2014.

According to the Acceptance, Waiver & Consent (AWC), Morgan Stanley prohibited registered representatives from exercising discretion, including time and price discretion, in commission-based accounts unless given prior written authorization from the customer and the firm. Discretion, or discretionary trading, occurs when a broker makes trades in customer accounts without the customer’s consent. It is also alleged that Puentes did not disclose his use of time and price discretion to Morgan Stanley when he responded to annual compliance questionnaires between 2010 and 2013. During this period, it is alleged that Puentes used time and price discretion in at least 14 customer accounts on approximately 220 occasions, violating Municipal Securities Rulemaking Board Rule G-17 that pertains to fair dealing.

He was sanctioned to a 30-day suspension from November to December 2016 and $15,000 in civil and administrative penalty fines.

Puentes has been the subject of 21 customer complaints between 2000 and 2017, according to his CRD report:

• January 2017. “Complaint involving the suitability of a municipal bond investment sold in 2012 and 2013 through Morgan Stanley.” The complaint was closed without action.
• February 2016. “Client alleges purchases of pr bonds were unauthorized. June 2012 – March 2013.” The customer sought $101,501 in damages and the case was settled for $19,200.
• January 2016. “Client verbally alleged, inter alia, that the purchase of Puerto Rico bonds in account were unauthorized – December 2009- January 2015.” The case was settled for $57,500.
• January 2016. “Client verbally alleged that the purchase of Puerto Rico bonds in account were unauthorized – December 2009 to July 2013.” The case was settled for $20,000.
• October 2015. “Claimant alleged, inter alia, unauthorized trading and unsuitability with respect to purchases of municipal bonds in accounts – 2012 to 2013.” The customer sought $200,000 in damages and the case was settled for $52,500.
• September 2015. “Client Alleges unauthorized trading, inter alia, with respect to municipal (SP) bonds- August 2011 – September 2014.” The customer sought $85,000 in damages and the case was settled for $30,000.
• September 2015. “Client alleged, inter alia, that the purchases of Puerto Rico bonds in his account were unauthorized. Alleged damages (SP) unspecified 2010-2013.” The case was settled for $15,000.
• August 2015. “Client alleges, inter alia, that from October 2011 to July 2013 the FA purchased unsuitable Puerto Rico municipal bonds in the clients account without his authorization.” The customer sought $300,000 in damages and the case was settled for $125,000.
• July 2015. “Claimants allege, inter alia, that from 2012 through 2013 the FA made unsuitable purchases in the clients’ account.” The customer sought $160,000 in damages and the case was settled for $20,000.
• June 2015. “Claimants allege, inter alia, that from 2012 through 2013 the FA made unsuitable purchases in the clients’ account.” The customer sought $450,000 in damages and the case was settled for $100,000.
• June 2015. “Claimants allege, inter alia, that from December 2011 through April 2013 the FA made unsuitable purchases in the clients’ account.” The customer sought $216,084 in damages and the case was settled for $64,500.
• April 2015. “Client’s attorney alleged, inter alia, that investments purchased in the client’s account were unsuitable. 2013 damages unspecified.” The customer sought $236,547.36 in damages and the case was settled for $60,000.
• April 2015. “Client’s attorney alleged, inter alia, that investments purchased in the client’s account were unsuitable. 2013 damages unspecified.” The customer sought $236,547.36 in damages and the case was settled for $60,000.
• March 2015. “Clients’ allege, inter alia, that from December 2011 to November 2014 the Puerto Rico bonds purchased in the clients’ account were unsuitable.” The customer sought $111,138 in damages and the case was settled for $35,000.
• January 2015. “Claimant alleged, inter alia, that purchases of bonds in account were unauthorized and unsuitable – 2009 – 2013.” The customer sought $373,000 in damages and the case was settled for $99,000.
• March 2014. “Client alleges, inter alia, that there were unauthorized purchases of bonds in their account in 2013. Damages unspecified.” The case was settled for $35,000.
• October 2011. “Client alleged that the purchase of Fannie Mae securities in his account were unsuitable. 2008. Damages unspecified.” The case was denied.
• July 2010. “Client alleged unauthorized trading with respect to investments. Damages unspecified.” The case was denied.
• March 2007. “Client alleged that there were unauthorized transactions made in his account. 2004-2007. Damages unspecified.” The case was closed without action.
• January 2002. “Alleges he sustained losses due to incorrect advice received concerning the sale ability of his rule 144 restricted stock.” The customer sought $4.2 million in damages but the case was denied.
• September 2000. “The client alleged that investments made in her IRA and trust accounts were inappropriate, bonds were purchased on margin without her permission, excessive trading, and she was never advised that her assets were more than sufficient to offset any costs associated with her long term care purchase. Alleged damages – unspecified.” The case was denied.

In addition, 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, Morgan Stanley may be liable for investment or other losses suffered by Puentes’ customers.

Erez Law represents investors in the United States for claims against former Morgan Stanley financial advisor Tom Abel Puentes, who is alleged to make discretionary trades in customer accounts without the customer’s consent. If you were a client of Morgan Stanley financial advisor Tom Abel Puentes or another firm, and have experienced investment losses, please call us at 888-840-1571 or complete our contact form. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies.