Reid & Rudiger Complaint: FINRA Alleges Churning, Excessive Trading

A disciplinary proceeding released by the Financial Industry Regulatory Authority (FINRA) Department of Enforcement alleges that broker-dealer firm Reid & Rudiger “churned and/or excessively traded 20 customers’ accounts” over a period of six years. In addition to naming the firm as respondent, FINRA alleges that representatives Edward Rudiger (CRD# 2118724) and Clifford Reid (CRD# 1905920) conducted trades that “resulted in this egregious customer harm.” It also alleges that Marc Harrison (CRD# 1605568), the firm’s majority owner, and Kelli A. Mezzatesta (CRD# 4701170) failed to identify and investigate red flags of misconduct.

Filed in March 2026, FINRA’s complaint alleges that the firm and Mr. Rudiger recommended “a high-volume, high-cost market-timing strategy” in at least 15 accounts during the period in question. This strategy “involved repeatedly taking large equity positions in stocks, often using margin, and then selling out of them after relatively short periods to fund purchases of different stocks.” According to FINRA, this strategy was either unsuitable or not in the best interests of the customers in question, because the firm and Mr. Rudiger “failed to consider that the substantial commissions and costs associated with this investment strategy made it virtually impossible for his customers to earn a profit.” The complaint also alleges that the firm and Mr. Rudiger excessively traded and churned the accounts of at least eight of the customers.

FINRA also alleges that during the period in question, the firm and Mr. Reid recommended the same strategy in at least five customer accounts. Again, FINRA alleges that the strategy was unsuitable or not in the customers’ best interest, and that both the firm and Mr. Reid engaged in excessive trading of some of the accounts. Additionally, FINRA alleges that the firm “failed to establish and maintain a supervisory system reasonably designed to achieve compliance with FINRA rules and 4 federal securities laws and regulations prohibiting churning and excessive trading.”

The complaint seeks various sanctions against the respondents, including disgorgement and restitution. FINRA’s action remains pending.

Carlson Law represents investors throughout the United States in claims against financial advisors and investment firms. If you or a loved one have suffered investment losses, please call us at 888-976-6111 or complete our contact form for a free and confidential consultation.