"Because he said he used the money from his 401K account to invest on these stocks."

A Self-Directed IRA, an HSA, etc, might get a 1099-B and need to file a 990-T, such as UBTI:

https://www.fidelity.com/tax-information/tax-topics/ubti

For instance, a Self-Directed IRA holding rental property with debt, has to report.

If your client's 401(k) is trading Stocks, all he did is forfeit capital gains treatment upon distribution, because it will be taxable income when taken.

If your taxpayer has a 1099-B issued to him from his own 401(k), either it is not reportable, or he doesn't understand what he did. Example: he borrowed from the 401(k) to invest in stocks with the  same brokerage, and the 1099-B is in his personal name = reportable.