A former registered rep on Monday was ordered to pay $2.6 million in damages to his ex-wife in an arbitration claim that centered on margin, day trading and shorting stock.
The broker, Barry Snyder, denied the allegations listed in the award, which was issued by a panel under the auspices of the Financial Industry Regulatory Authority Inc. The claimant, Elizabeth Snyder, filed the claim in November 2018, named J.P. Morgan Securities and Deutsche Bank Securities as claimants, along with her ex-husband, and requested damages of $5.1 million.
She also claimed fraud and negligence, and investments in stocks, such as Habit Restaurants Inc. and Global Eagle Entertainment Inc.
"He was a trader and got hooked on this one stock, a hamburger chain called Habit Restaurants," said Robert W. Pearce, Elizabeth Snyder's attorney. "It was a terrible lapse of judgment."
Barry Snyder worked at Deutsche Bank Securities from 2003 to 2009 and J.P. Morgan Securities from 2013 to 2015, according to his Finra BrokerCheck profile. He worked in south Florida for both firms and is currently not registered with a brokerage firm.
He was fired from J.P. Morgan in the spring of 2015 and then set up his own family office, Pearce said. After they divorced in the early 2000s, Elizabeth Snyder eventually became her ex-husband's client several years later, Pearce said.
"At a point in time, 80% to 90% of her account was in the one stock, and he was leveraged and day trading," Pearce said. The share price for Habit Restaurants "popped in the spring of 2015, but by the end of July to early August it got whacked. Her account went from $4.5 million net equity to under $50,000 at the end of the year. That was everything she had."
In 2020, Elizabeth Snyder dropped the claims against the two banks in a move of "voluntary dismissal," which indicates a potential settlement.
Barry Snyder's attorney, Neil Baritz, declined to comment on the arbitration award. He has one more pending arbitration claiming damages of $500,000, according to his BrokerCheck profile.
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