← Broker database 2026-04-21
Staten Island Principal Frederick Cammarano Suspended for Failing to Address Excessive Trading Red Flags
According to FINRA, Frederick Joseph Cammarano III was assessed a deferred fine of $15,000 and suspended from association with any FINRA member in any principal capacity for 18 months (April 21, 2026, through October 21, 2027), following an April 21, 2026 Order Accepting Offer of Settlement.
Cammarano, acting as a supervisory principal, failed to reasonably investigate and address multiple red flags indicating that firm representatives were engaged in potentially excessive trading and churning. Despite being aware of these red flags, Cammarano did not take adequate steps to supervise the representatives or investigate the warning signs of misconduct. FINRA found that the representatives engaged in willful violations of Section 10(b) of the Securities Exchange Act of 1934—the fundamental antifraud provision of federal securities law.
Excessive trading and churning—where brokers trade excessively in customer accounts to generate commissions rather than to serve the customer's investment objectives—are among the most harmful forms of broker misconduct. The costs of frequent trading accumulate rapidly: commissions, fees, and taxes on realized gains can significantly erode an investor's wealth over time, even when individual transactions appear innocuous in isolation. Principals who are aware of warning signs and fail to investigate or take corrective action bear regulatory responsibility for the resulting harm alongside the brokers who executed the trades.
Supervisory principals occupy a critical position in the securities industry's self-regulatory framework. Their obligation is not merely to review account activity as a formality, but to genuinely investigate concerning patterns and take meaningful corrective action when red flags appear. A principal who is aware of potential misconduct but fails to act is not fulfilling this fundamental role.
Investors whose accounts show unusually high trading activity relative to their portfolio size or stated investment objectives should review their account statements carefully for turnover rates and total commission costs. High trading frequency is a key indicator of potential churning. Investors who believe their accounts have been excessively traded may have the right to seek recovery through FINRA arbitration.