According to FINRA, Gary Steven Costello has been barred from association with any FINRA member firm in all capacities for refusing to appear for on-the-record testimony.

FINRA requested Costello's testimony in connection with its investigation into allegations that he had cancelled trades he placed in his personal account and rebilled them to several of his customers' accounts—causing those customers to incur losses for trades they did not place.

Under FINRA rules, registered representatives are required to cooperate with regulatory investigations, including providing testimony when requested. Refusal to cooperate is itself a serious violation that results in an automatic bar from the securities industry.

The underlying allegations are concerning: if true, the practice of shifting losing trades from a personal account to customer accounts would constitute a serious breach of fiduciary duty and potentially securities fraud. By rebilling trades, a broker could profit at customers' direct expense by transferring losses to their accounts.

What Investors Can Learn: This case highlights the importance of regularly reviewing account statements and trade confirmations. Investors should verify that all transactions in their accounts were actually authorized by them. Unexpected trades, particularly losing ones, should prompt immediate inquiry with the broker and the firm's compliance department. Investors can also check a broker's disciplinary history through FINRA's BrokerCheck tool.