A Finra arbitration panel has ordered Cetera Advisors to pay a former financial advisor $3 million in damages for wrongful termination and defamation.
Cetera also was ordered by the three-member panel to pay Gerald Fasanella $10,000 in witness fees and $375 in filing fees.
Fasanella, who had been in the industry since 1978 and with Cetera from 2014 until his termination in 2019, was accused by the firm of executing trades in customers’ accounts without their authorization, according to his BrokerCheck record.
Fasanella claimed that Cetera engaged in a premeditated scheme to defame and wrongfully terminate him. Among the causes of action asserted in the complaint were wrongful termination, breach of contract, defamation and tortious interference with a business relationship, breach of good faith and fair dealing, and violation of industry rules, including Finra’s.
He had sought between $1.5 million and $3.6 million for damages, an unspecified amount for punitive damages and $10,000 in expert witness fees. He also requested that 100% of Finra’s fees be assessed against Cetera, and that the U5 document filed by Cetera be expunged from his record.
“My client is extremely thrilled with the outcome,” Fasanella’s attorney Michael Hill of Menzer & Hill in Boca Raton said. “We felt that the evidence was strong, and Cetera just didn’t have the facts to support their defense.”
The panel agreed for the most part. It also recommended that the reason for termination and termination explanation be expunged. “Termination shall be changed to 'voluntary,' and the termination explanation should be deleted entirely and shall appear blank. This directive shall apply to all reference to the reason for termination and termination explanation,” the panel said, explaining that its decision for expungement is based on the defamatory nature of the information.
Cetera had requested a dismissal of the claim and all fees and costs incurred.
A spokesman for Cetera said the firm does not comment on legal matters.
Fasanella began working in the industry in 1978 with Merrill Lynch, where he worked for 11 years. He worked at five other firms including Sunamerica Securities and Next Financial Group before joining Cetera.
Since leaving Cetera in 2019, Fasanella had not been registered with a firm until February, when he joined Heron Equity Management in Melbourne, Fla., where he serves as president. He declined to comment on the case.
Fasanella has eight customer disputes plus the termination on his record. The complaints mainly focused on misrepresentation, breach of contract and unsuitable options trading.