Cantor Fitzgerald & Co. Trader, Riaz Haidri, Suspended for Disclosing a Customer’s Confidential Trading Strategy to Another Customer

FINRA has suspended a Senior Managing Director at Cantor Fitzgerald & Co., Riaz Haidri, for three weeks for disclosing confidential information regarding a customer’s trading strategy and later confirming the customer’s identity to another customer. Mr. Haidri was the co-head of Cantor Fitzgerald’s high yield fixed income trading desk at the time of the alleged conduct. FINRA also fined Mr. $15,000 and ordered him to complete five hours of training.

Cantor Fitzgerald has employed Mr. Haidri since May 2013.

FINRA Letter of Acceptance, Waiver, and Consent No. 2017054288401

FINRA and Mr. Haidri entered into a Letter of Acceptance, Waiver, and Consent No. 201705488401 on March 24, 2021, after FINRA alleged that in August and September 2015, disclosed the trading strategy of a firm customer acquiring a long position in a distressed bond, and later confirmed its identity, to another firm customer that had a short position in the same bond, in violation of FINRA Rule 2010. Specifically, FINRA alleged:

• In 2015, Mr. Haidri was the co-head of Cantor’s high yield fixed income trading desk.
• At this time, the firm’s written supervisory procedures prohibited the disclosure of confidential information, including “customer orders, trades, positions and strategies,” to third parties.
• In June 2015, Mr. Haidri became aware that Cantor Customer A was interested in establishing a strategic position in bonds of a certain company.
• In July 2015, Customer A effected multiple purchases of the bonds through Cantor.
• In August 2015, Haidri disclosed Customer A’s strategy, which was confidential information, to Cantor Customer B, which he knew had a large short position in the bonds.
• Approximately ten days later, Customer B purchased the bonds from Cantor to partially cover its short position.
• In September 2015, Customer B asked Mr. Haidri to confirm the identity of Customer A, which he did.
• Later in September 2015, Customer B purchased the bonds from Cantor on two separate occasions.

By disclosing confidential information regarding a customer’s trading strategy and later confirming its identity to another customer, Mr. Haidri violated FINRA Rule 2010, which requires associated persons to observe high standards of commercial honor and just and equitable principles of trade.

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We have over 15 years of experience as securities arbitration lawyers and have helped investors recover investment losses in over 800 cases. The firm will file a FINRA securities arbitration claim on your behalf on a contingency fee basis to try to recover your losses. If we do not obtain a recovery, you do not owe us a legal fee.

This blog was published by August Iorio when he was a Partner at his previous firm and has been updated to reflect Iorio Law PLLC’s new contact information. To evaluate any potential claims, contact securities arbitration lawyer August Iorio for a free consultation contact Iorio Law PLLC at info@iorio.law or (646) 330-4624.