FINRA Files Temporary Cease-and-Desist Order Against Success Trade Securities and CEO Fuad Ahmed to Halt Fraud
FINRA Also Issues Complaint Charging Success Trade Securities and Ahmed With Fraudulent Sales of Promissory Notes
Many Current & Former NFL & NBA Players Among 58 Investors
WASHINGTON — The Financial Industry Regulatory Authority (FINRA) announced today that it has filed a Temporary Cease-and-Desist Order (TCDO) to halt further fraudulent activities by Washington, D.C.-based Success Trade Securities, Inc. and its CEO & President, Fuad Ahmed, as well as the misuse of investors' funds and assets. FINRA also issued a complaint against Success Trade Securities and Ahmed charging fraud in the sales of promissory notes issued by the firm's parent company, Success Trade, Inc., in which Ahmed holds a majority ownership interest. FINRA filed the TCDO, to which Ahmed and the company agreed, thus immediately freezing their activities, based on the belief that ongoing customer harm and depletion of investor assets are likely to continue before a formal disciplinary proceeding against Success Trade Securities and Ahmed will be completed.
Success Trade Securities is an online broker-dealer that operates through Just2Trade and LowTrades. In its complaint, FINRA alleges that Success Trade Securities, Ahmed and other registered representatives at the firm sold more than $18 million in Success Trade promissory notes to 58 investors, many of whom are current or former NFL and NBA players, while misrepresenting or omitting material facts. Specifically, FINRA's complaint alleges that Ahmed and Success Trade Securities misrepresented that they were raising $5 million through the sale of promissory notes and continued to make this representation, even as the sales exceeded the original offering by more than 300 percent. Most of the notes promised to pay an annual interest rate of 12.5 percent on a monthly basis over three years, with some notes promising to pay interest as high as 26 percent.
FINRA also alleges that Ahmed and Success Trade Securities failed to disclose the amount of the company's existing debt to investors and that it was unable to make future interest payments without raising money from new investors. In addition, FINRA charges that Ahmed and Success Trade Securities misrepresented how the proceeds would be used, instead improperly using the funds to make unsecured loans to Ahmed and to make interest payments to existing noteholders. FINRA further alleges that Ahmed and Success Trade Securities misrepresented the rate of return and exempt status of the private placement offering through which the notes were sold.
Under FINRA rules, the individuals and firms named in a complaint can file a response and request a hearing before a FINRA disciplinary panel. Possible sanctions include a fine, an order to pay restitution, censure, suspension or bar from the securities industry. The issuance of a disciplinary complaint represents the initiation of a formal proceeding by FINRA, in which findings as to the allegations in the complaint have not been made, and does not represent a decision as to any of the allegations contained in the complaint.
Investors can obtain more information about, and the disciplinary record of, any FINRA-registered broker or brokerage firm by using FINRA's BrokerCheck. FINRA makes BrokerCheck available at no charge. In 2012, members of the public used this service to conduct 14.6 million reviews of broker or firm records. Investors can access BrokerCheck at www.finra.org/brokercheck or by calling (800) 289-9999. Investors may find copies of this disciplinary action as well as other disciplinary documents in FINRA's Disciplinary Actions Online database.
FINRA, the Financial Industry Regulatory Authority, is the largest independent regulator for all securities firms doing business in the United States. FINRA is dedicated to investor protection and market integrity through effective and efficient regulation and complementary compliance and technology-based services. FINRA touches virtually every aspect of the securities business – from registering and educating all industry participants to examining securities firms, writing rules, enforcing those rules and the federal securities laws, informing and educating the investing public, providing trade reporting and other industry utilities, and administering the largest dispute resolution forum for investors and firms. For more information, please visit www.finra.org.
Just2Trade Review: Commissions, Fees, and Minimum Deposit
|Stocks and ETFs
||$2.50 (with $0.003 per share surcharge for extended hours trading)
||$2.50 + $0.50 per contract
|Spreads, Straddle (per leg)
||$2.50 + $0.50 per contract
||$2.50 + $75 foreign stock transaction fee
||$15 + $1 per bond
Just2Trade clearly states on its website that its services are for investors with at least two years of trading
experience, with knowledge of trading terminology and personal account management.
Clients are required to maintain $2,500 minimum account balance at all times.
Who is Just2Trade?
Success Trade Securities was founded in 1999 and serves as the parent company for three online investing sites –
Just2Trade, Successtrade and LowTrades. Success Trade Securities is a member of FINRA and SIPC.
We decided to open an IRA account with Just2Trade. Since it's not one of the three account types that could be opened online, we had to print out
a long application form and fill it out by hand. Then we scanned the form and emailed it to Just2Trade. No response. After a few more
tries and some back-and-forth with company's customer service, we (not the customer service) figured out that the file we were sending was
too big for Just2Trade's email service. As it turns out, it would have been enough to scan just the first two pages of the application form, not
all 15 of them (which begs the question of why they included so many non-required pages and never mentioned it). We were also informed by customer
service that we needed to send them a copy of an ID - again, something mentioned nowhere in the account application process.
Eager to try Just2Trade in action, and, after reading that ACH setup takes 10 business days (!) to complete, we decided to wire our funds. We followed all the instructions sent to us
by Just2Trade in their email. Two days later (wire transfer is supposed to take a few hours), we contacted the company about the missing funds.
Customer support was responsive only about 50% of the time (the other 50% we had to send second email) and not very helpful.
Eventually, days later, it turned out that we were supposed to mention on the wire
transfer form for which tax year the IRA deposit was being made - something never mentioned in company's wire transfer instructions. It took 10 days in total before the wired money appeared in our account.
This was the worst account opening and funding process of all the online brokers we’ve tried. The customer service was among the worst, too.
The types of accounts offered include Individual (U.S. Domestic and Foreign), Joint with Rights of Survivorship (U.S. Domestic and Foreign), Joint Tenants in Common (U.S. Domestic and Foreign),
Custodial Account (U.S. Domestic), Traditional IRA (U.S. Domestic), Roth IRA (U.S. Domestic), Rollover IRA (U.S. Domestic), SEP IRA (U.S. Domestic),
Corporate (U.S. Domestic and Foreign), LLC (U.S. Domestic and Foreign), Investment Club (U.S. Domestic), Trust (U.S. Domestic and Foreign), and Partnership (U.S. Domestic).
The company's trading tools are pretty good, including some neat technical analysis tools such as Stock Alerts, Stock Screeners, Technical Insight, and Daily Technical Events. With Stock Alerts you can set trading criteria on the stock and receive email notification when these criteria are met. With the Stock Screener you can search for stocks that match your parameters including industry, trading volume, PE ratio, and more.
The company is one of the last ones to still not offer mobile trading - there is no smartphone app.
- Just2Trade is under FINRA fraud investigation
- Just2Trade is under FINRA fraud investigation
- Wrong cash balances and other account balance discrepancies (!)
- A commission of $4.00 per trade will apply to accounts below the minimum $2,500 balance requirement
- An additional $0.003 per share to trade on the ECN during the extended-hours
sessions – from 7-9:30 AM EST pre-market and 4-8 PM EST after hours
- $25 IRA setup fee, $75 IRA closing fee and $35 annual fee for IRA accounts (if below $25,000 in assets)
- For customer service the company encourages contact by email
- High options exercise and assignment fee: $20 per exercise or assignment
- Checking and VISA debit card fees: $50 (Gold Package), $75 (Platinum Package)
- Minimum $2,500 account balance requirement
- No support for beginner investors
- Poor choice of mutual funds
- Open orders are randomly canceled
- Terrible account opening and funding process
- No smartphone app
Just2Trade Review Summary
Because of FINRA investigation we do NOT recommend opening account with Just2Trade!!!
Just2Trade charges very low commission on stocks and ETFs - just $2.50 per trade - which makes it one of the cheapest online stock brokers
for non-IRA accounts, if you trade over 500 shares on average per trade. However, many traders will
be disappointed with a large surcharge of $0.003 per share on extended hours trades.
The firm only accepts very experienced investors as customers: there is a requirement of at least two years of trading
experience and knowledge of trading terminology and personal account management. Clients are expected to be pretty much self-reliant.
The biggest problem with Just2Trade is the need for customers to constantly monitor their account balances to make sure
they are correct. The account balance can move widely in either direction. This is a huge issue - how can you trust a firm with your money
when they can't even properly maintain balance records?
Retirement account holders will have to pay $35 annual IRA fee.
(For fee-free retirement accounts, check out Best Brokerages for IRA list.)
Just2Trade's client base consists of very experienced traders who need cheap executions. There are few learning materials for
beginners, no online trader community, and no virtual trading environment. For these reasons, the firm is not a good
choice for a broker for beginner investors.
Because of account balance discrepancies and multiple fees, we don't recommend Just2Trade for anyone else, either.
There are other Top Rated Brokerages that offer low commissions, fewer fees, and don't have the
problems that plague Just2Trade.
Reviewed by Brokerage Review on
Reviewed by Editor and Just2Trade customers.