J.P. Morgan asks court for OK to erase broker’s disciplinary record

J.P. Morgan Securities wants a disciplinary record against a Yorktown Heights investment adviser to be expunged, claiming that an accusation against the adviser was false.

JPMS and investment adviser John Dacey petitioned Westchester Supreme Court on Nov. 17 to allow the Financial Industry Regulatory Authority to delete all references to a 2020 customer dispute on Dacey’s FINRA BrokerCheck report.

FINRA is a self-regulatory organization authorized by the U.S. Congress to oversee investment brokerage firms and their representatives. Its online BrokerCheck reports give investors snapshots of financial advisers’ employment histories, licensing and disputes.

Dacey, of Putnam County, works as a JPMS private client adviser at a Chase bank branch in Yorktown Heights.

In 2020, Marlo and Joyce Moss of Yorktown Heights had accused Dacey of negligence for recommending an unsuitable investment. They asked a FINRA arbitration panel to award $70,769 in damages, according to Dacey’s BrokerCheck record, and this past September the dispute was settled for $14,999.

JPMS filed for a new FINRA arbitration hearing in August, on behalf of Dacey, asking that the 2020 customer dispute be deleted from his BrokerCheck record.

The Mosses did not participate in an August 30 hearing, according to the case summary, and did not oppose the request.

Arbitrator William G. Binkes concluded on Sept. 21 that the original allegation against Dacey was false and should be expunged from his record.

Dacey had met with the Mosses in January 2020 and recommended several investment products, according to the arbitrator’s findings.

The products were consistent with the Mosses’ investment goals. They opened an account in February 2020 and bought a balanced U.S.-focused municipal bond fund.

But in March 2020 the financial markets declined rapidly during the onset of the Covid-19 pandemic. The Mosses advised Dacey to liquidate their account “because they were concerned with capital preservation as the market was losing value,” Binkes found.

Dacey began the liquidation on March 13, 2020.

Blinkes also noted that Dacey did not contribute to the settlement but did not explain why.

He recommended that all references to the Mosses arbitration award be expunged from Dacey’s FINRA record, but he stated that Dacey must first get a court to confirm the decision.

If confirmed, Dacey’s FINRA BrokerCheck record will list only one customer dispute, filed in 2006, when he worked for M&T Securities in Hopewell Junction. The client in that case believed that a variable annuity would provide a fixed death benefit. The case was settled in 2007 for $25,000.