Former Clients File Arbitrations against William Tatro

Rochester, NYWhen stockbrokers and financial advisors such as William Tatro allegedly fail to recommend suitable investments for their clients, their clients may be eligible to file arbitration claims against them to recover money lost to those unsuitable investments. According to some reports, Bill Tatro and his firm, Eagle Steward, have repeatedly recommended unsuitable investments to clients, allegedly costing some clients most or all of their life savings.

Tatro reportedly has a history of selling similar investments to all his clients, regardless of their age or financial situation. Among those allegedly unsuitable investments were Real Estate Investment Trusts (REITs), which had no ready market, and leverage inverse exchange traded funds (ETFs), which are highly unsuitable for many investors and not meant to be held long-term. One arbitration found in favor of Tatro's former client, resulted in an award of $530,000 to the former client. In making his decision, the arbitrator found that Tatro breached his fiduciary duty to his client by recommending unsuitable investments.

That arbitration was not the first complaint filed against Tatro. According to the Rochester Democrat and Chronicle (12/13/03), a lottery winner filed a $6.3 million arbitration against Tatro, alleging she lost most of her savings when he invested her money. The article notes that the lottery winner, in her mid-70s, alleges Tatro ignored her directions and invested $3.2 million of her money in high-risk ventures and churned her account [made unnecessary transactions to increase his commissions]. The plaintiff alleged she lost around $2 million of the $3 million she invested with him.

Tatro defended himself in the article, noting that if the lottery winner had held on to her investments, she would have regained her losses, but her attorneys argued that at 74 years old, she was not in a situation to wait out the market.

The Rochester Democrat and Chronicle article notes that at the time the lottery winner's arbitration was filed, Tatro was facing a federal lawsuit filed by four former clients, who alleged Tatro mismanaged their accounts.

That lawsuit, as reported by the Rochester Democrat and Chronicle (08/09/03), alleged Tatro "subjected the plaintiffs to heavy losses in the stock market by exposing their assets to inappropriate risks and misrepresented his qualifications." The plaintiffs allege Tatro lost hundreds of thousands of dollars by making unauthorized trades in their accounts.

Tatro defended himself, saying the plaintiffs were "disgruntled clients." The lawsuit was dismissed in 2006. Since that time, however, additional arbitration claims have been filed against William Tatro, alleging mismanagement of accounts.

In 2010, an arbitrator found in favor of one former Tatro client, Mid-Lakes Management Corp., awarding $530,000. Approximately $515,000 of the award was for damages, with an additional $15,000 approximately to recover commissions.

According to at least one source, Tatro's official record as a stockbroker, as reported by the Financial Industry Regulatory Authority, shows that Tatro has faced at least 50 complaints and/or lawsuits involving the payment of more than $3 million to his customers.