March, 2025 | Based in New York, NY
Take control of your financial future today. If you believe you’ve been affected by unsuitable investment recommendations, call 800-950-6553 or complete our online form to schedule your no-obligation case evaluation.
Essential Information About Daniel Matthew Diaz
- Full Name: Daniel Matthew Diaz
- CRD Number: 6871968
- Current Location: New York, NY
- Current Employer: PHX Financial, Inc.
- Office Address: 100 Wall Street, 10th Floor, New York, NY 10005
- Registration Status: Currently registered with 1 SRO and licensed in 48 U.S. states and territories
- State Licenses: Registered in 48 U.S. states including New York, California, Florida, and Texas
- Experience: In the industry since December 2017
- FINRA BrokerCheck: 1 pending customer dispute
- Previous Employers: National Securities Corporation (05/2019-12/2019 and 12/2017-03/2019)
- Ability to Recover Losses: Investors may have arbitration eligibility for claims within applicable statute of limitations
Private Equity Concerns: The Daniel Diaz Investment Fraud Investigation
Financial advisor Daniel Matthew Diaz, currently employed by PHX Financial, Inc. in New York, NY, is the subject of a pending customer dispute alleging he recommended unsuitable investments over a four-year period. Our securities fraud attorneys are investigating these allegations to determine if other investors may have been similarly affected by potentially improper investment recommendations.
According to FINRA records, a customer filed an arbitration claim against Diaz in August 2024, alleging that between November 2020 and December 2024, he recommended unsuitable private equity investments. While the exact nature of these investments isn’t detailed in public records, private equity investments often involve significant risk, limited liquidity, and complex fee structures that may not be appropriate for all investors.
The complaint is currently pending before FINRA Dispute Resolution in Dallas, Texas (Case #24-01709), and the claimant is seeking unspecified compensatory damages. This arbitration case raises serious questions about whether Diaz fulfilled his regulatory obligations to recommend only investments that were suitable for his clients’ financial situation, investment objectives, and risk tolerance.
Understanding the Allegations
The pending arbitration claim centers on allegations of unsuitable investment recommendations, which is one of the most common forms of broker misconduct. Financial advisors have a duty to ensure that any investment they recommend is appropriate for the specific client, taking into account factors such as:
- The client’s age and financial situation
- Investment objectives and time horizon
- Income needs and tax status
- Risk tolerance and investment experience
- Overall investment portfolio composition
Private equity investments—the subject of the complaint against Diaz—typically involve investing in companies that are not publicly traded. These investments often:
- Require substantial minimum investments
- Lock up investor capital for extended periods (often 7-10 years)
- Involve higher fees than traditional investments
- Carry significant risk, including potential loss of principal
- Lack transparency compared to publicly traded securities
For these reasons, private equity investments are generally considered suitable only for sophisticated investors with significant financial resources and a high tolerance for risk. The customer complaint suggests that Diaz may have recommended these complex investments to a client for whom they were inappropriate.
Professional Background and Registration History
Daniel Diaz has a relatively short history in the securities industry, having first become registered in December 2017. According to his FINRA BrokerCheck report:
- He obtained his Series 7 (General Securities Representative) license on December 19, 2017
- He passed the Series 63 (Uniform Securities Agent State Law) exam on January 18, 2018
- He obtained the Securities Industry Essentials (SIE) qualification on October 1, 2018
His employment history in the financial services industry includes:
1. PHX Financial, Inc. (December 2019 – Present)
- Currently registered with this firm as a General Securities Representative
- Registered in 48 U.S. states and territories
2. National Securities Corporation (May 2019 – December 2019)
- Brief period of employment
- Registered in Jersey City, NJ
3. National Securities Corporation (December 2017 – March 2019)
- First position in the securities industry
- Registered in Jersey City, NJ
Prior to entering the securities industry, Diaz’s reported employment history includes positions as a student at Saint Francis College (2016-2017), a laborer at Dama Home Improvement (2012-2016), and a lifeguard at Blue Lagoon (2012-2015).
The relatively short duration of Diaz’s initial positions at National Securities Corporation before moving to PHX Financial is notable. While job changes are common in the financial services industry, frequent moves early in a career can sometimes indicate performance issues or concerns about sales practices.
Red Flags for Investors
The pending complaint against Daniel Diaz highlights several potential warning signs that investors should be aware of:
1. Private Equity Recommendations
Private equity investments are complex products that may carry high fees and limited liquidity. These characteristics make them potentially unsuitable for many retail investors, especially those with shorter time horizons or liquidity needs. The allegation that Diaz recommended unsuitable private equity investments raises questions about his understanding of his clients’ needs and his adherence to suitability requirements.
2. Recently Established Industry Experience
Diaz has been in the securities industry since December 2017—approximately seven years as of the time of this investigation. This is a relatively short period compared to many established financial advisors. Less experienced brokers may not fully understand the complexities of sophisticated investment products or may be more susceptible to sales pressure from their firms.
3. Broker’s Response to Allegations
In his response to the customer complaint, Diaz stated: “I deny any wrongdoing, these allegations are frivolous in nature. Subsequent to resolution of this matter I intend to seek full expungement from my record.” While brokers have every right to defend themselves against allegations, this categorical denial without addressing the specific suitability concerns could indicate a lack of appreciation for the serious nature of the complaint.
4. Registration in 48 States
While not inherently problematic, Diaz’s registration in 48 states suggests he may be managing clients across a wide geographic area. This could potentially make it more difficult to maintain close relationships with clients and fully understand their evolving financial situations and needs—a critical component of making suitable investment recommendations.
Regulatory Framework: Suitability and Broker Obligations
Financial advisors like Daniel Diaz operate within a strict regulatory framework designed to protect investors. Several key regulations are particularly relevant to the allegations in this case:
FINRA Rule 2111: Suitability
This cornerstone regulation requires that a broker have a reasonable basis to believe that a recommended transaction or investment strategy is suitable for the customer, based on information obtained through reasonable diligence. The rule has three main components:
- Reasonable-basis suitability: The broker must understand the potential risks and rewards of the recommended security or strategy.
- Customer-specific suitability: The broker must have a reasonable basis to believe the recommendation is suitable for a particular customer based on that customer’s investment profile.
- Quantitative suitability: The broker must have a reasonable basis to believe that a series of recommended transactions, even if suitable when viewed in isolation, are not excessive when taken together.
SEC Regulation Best Interest (Reg BI)
Implemented in June 2020, Reg BI establishes a “best interest” standard of conduct for broker-dealers when making recommendations to retail customers. Under Reg BI, brokers must:
- Disclose all material facts about the recommendation, including costs
- Exercise reasonable diligence, care, and skill
- Identify and eliminate or mitigate conflicts of interest
- Establish, maintain, and enforce policies and procedures designed to comply with Reg BI
FINRA Rule 2010: Standards of Commercial Honor
This ethical rule requires all brokers to “observe high standards of commercial honor and just and equitable principles of trade.” Recommending unsuitable investments could potentially violate this standard.
Implications for Investors Who Worked with Daniel Diaz
If you are or were a client of Daniel Diaz at PHX Financial or his previous employers, particularly if you invested in private equity investments or other complex financial products, you should consider the following steps:
1. Review Your Investment Portfolio
- Examine all investments recommended by Diaz, especially private equity investments
- Assess whether these investments align with your stated investment objectives and risk tolerance
- Review performance against benchmarks and expectations
2. Check for Documentation
- Gather all account statements, investment confirmations, and communications
- Review disclosure documents to understand the risks, fees, and terms of your investments
- Confirm whether you received complete information about the investments before making decisions
3. Evaluate Liquidity and Time Horizon
Private equity investments typically require long-term commitments. Consider whether:
- The expected holding period was clearly explained to you
- The liquidity constraints align with your financial needs
- Exit options were properly disclosed and discussed
4. Consider Professional Review
If you have concerns about investments recommended by Diaz, consider:
- Consulting with an independent financial advisor for an objective assessment
- Speaking with an experienced securities attorney about potential recovery options
- Requesting a comprehensive review of your account activity and recommendations
How Our Investment Fraud Attorneys Can Help
Our firm specializes in representing investors who have suffered losses due to unsuitable investment recommendations, broker misconduct, or inadequate disclosure. If you invested with Daniel Diaz and have concerns about your investments, our attorneys can provide:
Comprehensive Case Evaluation
We begin with a thorough review of your investment history, documentation, and communications with Diaz. This helps us identify potential violations and determine the strength of your claim.
FINRA Arbitration Expertise
Most investment disputes are resolved through FINRA arbitration rather than in court. Our attorneys have extensive experience with this specialized process and can guide you through every step, from filing the initial statement of claim through the final hearing.
Analysis of Private Equity Investments
Our team works with financial experts to analyze private equity investments and determine whether they were suitable based on your investment profile, properly disclosed, and appropriately recommended.
Broker and Firm Liability Assessment
We evaluate potential claims against both Daniel Diaz individually and PHX Financial as his supervising broker-dealer. Brokerage firms have a duty to supervise their representatives and may be liable for failing to prevent unsuitable recommendations.
Maximizing Recovery Options
We explore all potential avenues for recovery, including:
- FINRA arbitration claims
- Negotiated settlements
- Regulatory restitution programs
- Alternative dispute resolution processes
Understanding Your Rights and Recovery Process
If you believe you have suffered losses due to Daniel Diaz’s investment recommendations, it’s important to understand your rights and the recovery process:
Statutes of Limitations
- FINRA arbitration claims generally must be filed within six years of the event giving rise to the claim
- Some states have shorter statutes of limitations for investment-related claims
- The clock typically begins running from when the investment was made or when the investor discovered or should have discovered the misconduct
FINRA Arbitration Process
The typical FINRA arbitration follows these steps:
- Filing a statement of claim
- Selection of arbitrators
- Pre-hearing conferences
- Discovery of relevant documents
- Preparation of witnesses and evidence
- Arbitration hearing
- Award decision
Potential Recovery
Damages that may be recovered can include:
- Out-of-pocket losses
- Market-adjusted damages (what your portfolio would have been worth in suitable investments)
- Interest on losses
- In some cases, attorneys’ fees and costs
The Importance of Acting Promptly
If you have concerns about investments recommended by Daniel Diaz, particularly private equity investments, it’s crucial to act quickly for several reasons:
- Preservation of Evidence: Documents and communications relevant to your case may become more difficult to obtain as time passes.
- Statute of Limitations: Delaying action could jeopardize your ability to file a claim within the required timeframe.
- Ongoing Losses: If you remain in unsuitable investments, you may continue to incur losses or miss opportunities for more appropriate investments.
- Recovery Potential: The sooner you initiate the process, the sooner you may recover losses and redirect your investment strategy.
Don’t leave your financial future to chance. Our experienced investment fraud attorneys are ready to help you understand your options and pursue recovery of any losses due to unsuitable investment recommendations.
Take the first step toward protecting your financial security. Call 800-950-6553 or complete our online form today to schedule your confidential, no-obligation case evaluation with an experienced investment fraud attorney who can help you assess your potential claims against Daniel Diaz and PHX Financial.
