See United States v. Sliwo, 620 F.3d 630, 638-642 (6th Cir. 2010) (Katz, J., dissenting). In this case, there is ample circumstantial evidence in the record supporting an inference that Koenig conspired with Capwill, Sandelier, and Paul Giarmoleo, Sandelier's friend and a broker at First Montauk, see Javitch v. First Montauk, 279 F.Supp.2d 931, 935-937 (N.D. Ohio 2003), to approve the wrongful transfer of funds from CFL to Norman's nominee account at Union, and then to Norman's nominee account at First Montauk. Koenig approved Norman's account opening papers, which contained wildly false financial information, despite never having met or spoken with Norman. Additionally, Koenig gave assurances to Union's CEO, Thompson, that the transfer of $750,000 out of Norman's account was part of a valid stock trading transaction, which turned out to be false. When coupled with Koenig's established relationship with Sandelier, these facts, viewed in the context of the whole record, give rise to a fair inference that Koenig conspired with Capwill, Sandelier, and Giarmoleo to effect fraudulent money transfers.

NASD Rule 3040 is an industry rule that has been held relevant in determining if a defendant had the "means and ability" to control an agent for state law claims. See e.g., Piper, Jaffray Hopwood, Inc. v. Ladin, 399 F.Supp. 292, 299 (S.D. Iowa 1975) (although NASD and NYSE rules are admissible as indicia of proper standard of conduct in negligence case); Miley v. Oppenheimer Co., 637 F.2d 318, 333 (5th Cir. 1981) (NASD and NYSE rules are excellent tools to assess reasonableness of broker's conduct);Merrill Lynch v. Cheng, 697 F.Supp. 1224, 1227 (D.D.C. 1986) (violation of NASD rule is evidence of broker's negligence); Scott v. Dime Savings Bank, 886 F.Supp. 1073, 1080-81 (S.D.N.Y. 1995) (same); Javitch v. First Montauk Fin. Corp., 279 F.Supp.2d 931, 938 (N.D. Ohio 2003) (NASD rules are evidence of the reasonable standard of care in the securities industry). As the Defendants agreed to supervise Stokes under NASD standards, the Defendant share a responsibility for these securities transactions under NASD standard, Stokes agreed to comply with defendants' supervision.

But other cases suggest that "no fiduciary duty arises between a broker and his client in relation to" accounts such as the ones here. See Javitch v. First Montauk Fin. Corp., 279 F. Supp. 2d 931, 937 (N.D. Ohio 2003) (quoting J.C. Bradford Futures, Inc. v. Dahlonega Mint, Inc., 907 F.2d 150, 1990 WL 95625, at *5 (6th Cir. 1990) (table)). The parties dispute this question, and we need not answer it.

Allowing such surgical presentation of the cause of action here would undermine the congressional intent behind the RICO Amendment." Javitch v. First Montauk Fin. Corp., 279 F. Supp. 2d 931, 943-44 (N.D. Ohio 2003) (citing Bald Eagle Area School Dist., 189 F.3d at 330). Count VI implicates "conduct that would have been actionable as [securities] fraud."

other courts have also relied on SRO rules to determine the scope of a duty. See, e.g., Miley v. Oppenheimer & Co., Inc., 637 F.2d 318, 333 (5th Cir. 1981) abrogated on other grounds by Dean Witter Reynolds Inc. v. Byrd, 470 U.S. 213, 105 S.Ct. 1238, 84 L.Ed.2d 158 (1985) ("NYSE and NASD rules are excellent tools against which to assess in part the reasonableness or excessiveness of a broker's handling of an investor's account."); Sec. Exch. Comm'n v. Badian, No. 06 Civ 2621. (LTS)(DFE), 2010 WL 4840063, at *2 (S.D.N.Y. Nov. 19, 2010) (holding that NASD Rule 3010(a) imposes a duty on members); As You Sow v. AIG Fin. Advisors, Inc., 584 F.Supp.2d 1034, 1048 (M.D. Tenn. 2008) (holding SRO rules assist courts in defining the extent of a legal duty at common law); Colbert & Winstead, PC 401(k) Plan v. AIG Fin. Advisors, Inc., No. 3:07–1117, 2008 WL 2704367, at *10 (M.D. Tenn. 2008) ("[T]he relationships defined and governed by the NASD may define the scope of a duty of a broker dealer."); Javitch v. First Montauk Fin. Corp., 279 F.Supp.2d 931, 938 (N.D. Ohio 2003) ("[T]he standard in the industry is reflected in the rules of both NASD and NYSE."); Lange v. H. Hentz & Co., 418 F.Supp. 1376, 1383 (N.D. Texas 1976) ("NASD rules are admissible on the issue of what fiduciary duties are owed by a broker to an investor."). In light of these authorities, the Court holds it can properly consider the FINRA rules governing MSI to determine whether it had a duty to supervise the investment advisory activities of its registered representatives.

And, even though the FINRA rules do not provide a private cause of action, failure to comply with the rules may provide evidence of a breach of the duty of care, "which includes a duty to act in accordance with the standard of care used by other professionals in the community." Remington v. Newbridge Sec. Corp., 2013 U.S. Dist. LEXIS 79082, at *18-19 (S.D. Fla. June 5, 2013) (citing Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Cheng, 697 F. Supp. 1224, 1228 (D.D.C. 1988); see also Javitch v. First Montauk Fin. Corp., 279 F. Supp. 2d 279, 938 (N.D. Ohio 2003) (NASD and NYSE rules reflect the industry standard); Lange v. H. Hentz & Co., 418 F. Supp. 1376, 1384 (N.D. Tex. 1976) (holding that NASD Rules may provide a foundation for the standard of care in the industry). Plaintiffs here set out a negligence argument similar to that argued by the plaintiffs in Remington. 2013 U.S. Dist. LEXIS at*16.

" Id. at 1228; see also Javitch v. First Montauk Fin. Corp., 279 F. Supp. 2d 931, 938 (N.D. Ohio) (finding that, even if there is no private cause of action for violation of NASD or NYSE rules, "the standard [of practice] in the industry is reflected in the rules of both NASD and NYSE."); Miley v. Oppenheimer & Co., Inc., 637 F.2d 318, 333 (5th Cir. 1981)) (finding that "NYSE and NASD rules are excellent tools against which to assess in part the reasonableness or excessiveness of a broker's handling of an investor's account."). The Court finds the reasoning in Cheng to be applicable in this matter.

As for the element of knowledge, courts have required actual knowledge of the underlying tortious conduct. See Aetna, 219 F.3d at 533; Javitch v. First Montauk Fin. Corp., 279 F.Supp.2d 931, 946 (N.D.Ohio 2003); see also In re Sharp Int'l Corp., 403 F.3d 43, 49 (2d Cir. 2005). A plaintiff, however, need not allege that the aider and abettor had actual knowledge "of all of the details of the primary party's scheme."

The alleged mail and wire transactions were undertaken "in connection with" the securities sale. That plaintiff describes them as mail or wire fraud in the complaint is irrelevant. See Bald Eagle, 189 F.3d at 330; Javitch v. First Montauk Fin. Corp., 279 F. Supp. 2d 931, 943 (N.D.Ohio 2003) (plaintiff "cannot avoid the RICO Amendment's bar by pleading mail fraud [and] wire fraud . . . as predicate offences . . . if the conduct giving rise to those predicate offenses amounts to securities fraud" (internal quotation marks omitted)). At oral argument, plaintiffs' counsel presented two cases in support of the proposition that a RICO violation could be made out on the basis of real-estate fraud predicate acts.

Courts have interpreted the first element as requiring actual knowledge of the underlying tortious conduct. See Aetna, 219 F.3d at 533; Javitch v. First Montauk Fin. Corp., 279 F.Supp.2d 931, 946 (N.D.Ohio 2003); see also In re Sharp Int'l Corp., 403 F.3d 43, 49 (2d Cir. 2005). A plaintiff, however, need not allege that the aider and abettor had actual knowledge "of all of the details of the primary party's scheme."