A California-based broker has been accused of a series of violations for his alleged actions involving the account of a terminally ill customer who later passed away, according to ThinkAdvisor.
The FInancial Industry Regulatory Authority filed a complaint against John Polemis, who was a registered representative of Park Avenue Securities and was later registered with Stirlingshire Investments and Sphinx Investments, working at an office in San Diego, California.
According to FINRA, Polemis induced a customer he knew to be terminally ill to lend him $28,000 by pretending he would repay the loans. Not only did he not repay the loans, it is alleged, Polemis additionally traded in the customer’s account in the weeks and months after his death, generating more than $3,000 in commissions.
“Polemis solicited and obtained these 20 loans in violation of his firms’ written policies and procedures,” FINRA states. “By this conduct, Polemis violated FINRA Rules 3240 and 2010. In June and August 2024, after Customer A’s death, Polemis placed two trades with a total principal value of approximately $157,579 in one of Customer A’s accounts, without Customer A’s prior authorization. The trades generated $3,151.59 in commission. By this conduct, Polemis violated FINRA Rule 2010.”
At the time the customer died, he held a trust account at Stirlingshire that was not approved for discretionary trading, FINRA said. Neither the customer nor his estate authorized the transactions.
FINRA further alleged that Polemis had not adequately responded to the authority’s investigation of the matter. Regulators made two requests for information and documents, in October and November of 2025. It is a violation of FINRA Rule 8210 to fail to respond to FINRA investigations and can result in being barred from the securities industry.
FINRA made a preliminary determination to recommend that disciplinary action be brought against Polemis alleging violation of FINRA Rules 3240 and 2010 for borrowing funds from a customer; violation of FINRA Rule 2010 for making material misrepresentations to obtain funds; violation of FINRA Rule 2010 for effecting transactions in a customer’s non-discretionary account without the customer’s prior written or oral authorization; violation of FINRA Rules 4511 and 2010 for causing a member firm to maintain inaccurate books and records; and violation of FINRA Rules 8210 and 2010 for failing to provide information and documents requested pursuant to FINRA Rule 8210.
In September 2024, Stirlingshire filed a Form U5 termination notice over what it said were concerns that Polemis had received a loan from the customer that had not been disclosed or approved by the firm. The firm said it learned that he had connected his personal bank account with the customer’s brokerage account.
In response, Polemis said he believed the allegations asserting the violations of industry standards of conduct were false and appeared to be unsubstantiated or erroneous. He said the personal account alleged to have been connected to the customer’s account was not established by him, and that it was a business account not connected to him.
The attorneys at Hyman Cotter have decades of experience dealing with securities fraud cases and have a deep understanding of how capital markets and financial service firms are intended to work to protect investors. If you think your financial professional or firm engaged in misconduct that caused you investment losses, contact Hyman Cotter at (833) 665-0784 or through our online contact form for a no-cost evaluation of your matter.
