Haselkorn & Thibaut has opened an investigation into financial advisor Jesse Krapf following serious regulatory violations and multiple customer complaints that have raised significant concerns for investors. Our experienced securities attorneys are examining patterns of misconduct that may have resulted in substantial investor losses.
FINRA Suspension for Excessive Trading Violations
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Jesse Krapf was suspended for five months by FINRA on October 30, 2024, for violating Regulation Best Interest (Reg BI) through excessive and unsuitable trading in a senior customer’s account. The suspension, which runs from November 18, 2024 through April 17, 2025, represents one of the most serious regulatory actions that can be taken against a registered representative.
The violations are particularly troubling because they involved a vulnerable senior investor. Between October 2019 and April 2022, Krapf recommended a series of trades that were excessive, unsuitable, and not in the customer’s best interest, with the senior business owner relying on Krapf’s advice and routinely following his recommendations.
Costly Trading Pattern That Harmed Investors
The extent of the financial damage reveals the severity of Krapf’s misconduct. Krapf’s trading generated total trading costs of $96,496, including $92,847 in commissions, and caused $41,017 in total realized losses for the customer.
One egregious example highlights the problematic nature of these transactions. In April 2020, Krapf recommended that the customer purchase nearly $180,000 of stock in a biotechnology company and then recommended selling the position just two days later, charging commissions of $7,800 on this round-trip transaction.
According to FINRA’s order, the account showed an annualized turnover rate of 23 and an annualized cost-to-equity ratio of 104 percent, far exceeding industry standards where a turnover rate of 6 or more, or a cost-to-equity ratio greater than 20%, usually indicates excessive transactions.
Extensive History of Customer Complaints
Jesse Krapf’s regulatory troubles extend well beyond the recent FINRA suspension. He has 6 disclosures on his FINRA CRD report, including a settled customer dispute from October 10, 2018, where allegations of negligence and breach of fiduciary duty resulted in a $165,000 settlement.
A separate customer complaint tells a similar story of substantial losses. In October 2018, a customer filed a complaint alleging violations of securities laws including negligence and breach of fiduciary duty, seeking $500,000 in damages related to common and preferred stock investments.
These complaints reveal a concerning pattern where investors trusted Krapf’s recommendations, only to suffer significant financial harm due to allegedly unsuitable investment strategies.
Personal Financial Management Issues
Even more concerning is Krapf’s apparent inability to manage his own finances. BrokerCheck records show that Krapf has been subject to debt-related judgments and tax liens, including a $3,247 tax lien from May 2015. This information is material for investors to consider, as it raises questions about whether someone who cannot manage their own financial affairs should be trusted with client investments.
Troubling Employment Pattern Across Multiple Firms
Jesse Krapf’s career trajectory raises additional red flags for potential investors. Since entering the securities industry in 2008, he has worked for an astonishing 10 different firms. This frequent job-hopping is often a warning sign in the financial services industry.
His recent employment history includes:
- Spartan Capital Securities, LLC (October 2019 – present)
- Benchmark Investments, Inc. (February 2019 – October 2019)
- Newbridge Securities Corporation (February 2016 – February 2019)
- Columbus Advisory Group, Ltd. (January 2015 – March 2015)
- Legend Securities, Inc. (February 2014 – January 2015)
Research shows a disturbing pattern where brokers with high numbers of customer complaints often move to lower quality firms with loose hiring practices and higher rates of customer complaints, with these firms averaging brokers with five times as many complaints as the industry average.
Understanding Your Rights as an Investor
If you invested with Jesse Krapf and experienced losses, you may have legal recourse. The securities industry operates under strict rules designed to protect investors, and when brokers violate these rules, they can be held accountable through FINRA arbitration.
Regulation Best Interest requires brokers to act in their clients’ best interests when making investment recommendations, considering the client’s investment profile and ensuring that recommended transactions are suitable and not excessive. When brokers fail to meet these obligations, investors can pursue recovery of their losses.
Red Flags Every Investor Should Recognize
The Jesse Krapf case illustrates several warning signs that investors should watch for:
- Excessive trading activity in your account without clear justification
- High commission charges that seem disproportionate to account performance
- Frequent buying and selling of the same or similar securities
- Pressure to make quick trading decisions without adequate explanation
- Investment recommendations that don’t align with your stated financial goals
Take Action to Protect Your Investment
Don’t let broker misconduct go unchallenged. If you suffered losses while working with Jesse Krapf at Spartan Capital Securities or any of his previous firms, experienced securities attorneys can help you understand your options for recovery.
The attorneys at Haselkorn & Thibaut have extensive experience representing investors who have been harmed by broker misconduct. We understand the complexities of securities law and FINRA arbitration procedures, and we’re committed to helping investors recover their losses.
For a free, confidential consultation about your potential claim, contact Haselkorn & Thibaut at 1-888-885-7162 . Our experienced legal team will review your case at no cost and help you understand your rights and options for pursuing recovery.
Time limits may apply to your claim, so don’t delay in seeking legal advice. Your financial future may depend on taking action now.
