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VFinance Investments, Inc. (VFinance) of Boca Raton, Florida submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) for allegedly failing to timely execute client orders.

FINRA found that on eight occasions, VFinance failed to execute customers’ orders in Over-The-Counter (OTC) securities. VFinance allegedly did not execute customer orders at the same price or a better price than what they had been trading in the market. This conduct is a violation of FINRA Rule 5320 and 2010. Continue reading →

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Barclays Capital Inc. (Barclays) of New York submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Department of Enforcement of the Financial Industry Regulatory Authority (FINRA) for allegedly knowingly publishing inaccurate index returns for approximately eight months. Barclays, a large full service broker dealer and bank stationed in New York, faced similar allegations in 2011 for allegedly posting inaccurate delinquency rates.

FINRA found that Barclays, from November 2010 through February 20, 2014, published “material inaccurate coupon return information” in connection to the firm’s Pan Euro ABS Floating Rate Index (Index). FINRA found that the false publications began in November 2010 after Barclays changed its method of calculating coupon rates and adopted a new coupon return data provider. Thereafter, FINRA alleged Barclay’s information technology group of London changed the proprietary pricing and valuation system in an effort to improve analytics. Continue reading →

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Jason Lee Reid, a former broker at the New York-based Halcyon Cabot Partners, LTD (Halcyon Cabot), submitted a Letter of Acceptance, Waiver and Consent in which he consented to, but did not admit to or deny, the described sanction and the entry of the Financial Industry Regulatory Authority’s (FINRA) findings that he created and solicited private securities offering documents which contained materially false and misleading information.

FINRA found that Jason Lee Reid, of New York, NY, knew or should have known that the private offering documents he created and used to solicit investors contained false and misleading information and failed to discuss material facts. According to FINRA, the offering documents failed to note the material risks posed by investing in the company and contained false and misleading statements regarding the company’s future business prospects. Continue reading →

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James Johnson, a former broker at the Waltham Massachusetts-based Commonwealth Financial Network, submitted a Letter of Acceptance, Waiver and Consent in which he consented to, but did not admit to or deny, the described sanction and the entry of the Financial Industry Regulatory Authority’s (FINRA) findings that he made negligent misrepresentations and omissions regarding a securities investment.

FINRA found that James Michael Johnson, of Richmond Virginia, discussed with his member firm customers a purchase of a 10% interest in West Virginia Farm Properties, LLC, a company formed to develop rural land into a residential neighborhood in West Virginia. Mr. Johnson misrepresented to the customers that all development costs had been covered; that the infrastructure for building the homes was already in place; that the houses were ready to be built on the property; and that the customers’ investment would allow the company to begin building homes immediately. Continue reading →

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Joseph Hooper, a former registered representative with Source Capital Group, Inc. (Source Capital), of Bowling Green Kentucky, submitted an Offer of Settlement in which he was fined and suspended by the Financial Industry Regulatory Authority (FINRA) for allegedly engaging in private securities transactions without notifying his member firm.

Without admitting or denying FINRA’s findings, Joseph Scott Hooper, of Bowling Green Kentucky, consented to the sanctions and to the findings that, while serving as Director of Investor Relations for the iPractice Group, Inc. (iPractice), he participated in the sale of iPractice stock and was compensated for his participation in these private securities transactions. Continue reading →

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John Kavaler, a former Registered Representative with the Charlestown, MA branch of Ameriprise Financial Services, Inc. (Ameriprise), submitted a letter of acceptance, waiver, and consent in which he consented to, but did not admit to or deny, the Financial Industry Regulatory Authority’s (FINRA) sanction and findings that he made unsuitable ETN recommendations to his customers.

FINRA’s findings alleged that John David Kavaler, of Boston Massachusetts, recommended that several customers invest in a highly volatile Exchange-Traded Note (ETN), the VXX. According to FINRA, the VXX ETN is a complicated and risky investment which is unsuitable for unsophisticated investors. Mr. Kavaler, however, recommended that his customers invest in the VXX ETN without adequately explaining the risks involved or the nature of the investment. FINRA stated that Mr. Kavaler mistakenly recommended the ETN as a suitable hedge for long positions in the market for his customers. Continue reading →

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Conrad Huss of Airmont, New York submitted an Offer of Settlement to the Department of Enforcement of the Financial Industry Regulatory Authority (FINRA) for allegedly misrepresenting material facts in the sale of promissory notes. Mr. Huss first became associated with FINRA through a member firm in November 1989. From January 15, 2005 through October 31, 2006, Mr. Huss was a registered representative with du Pasquier & Co., Inc. (DPC).

While associated with DPC, FINRA found that Mr. Huss made misrepresentations in the solicitation and sale of $1.4 million worth of promissory notes in a private offering to 14 DPC customers. According to FINRA, the notes were issued by Economic Development Finance Corporation (EDFC), a Massachusetts real estate development company. After the offering (between March 2006 and August 2006) EDFC defaulted under the EDFC Notes and failed to pay DPC’s customers the principal due. This resulted in significant losses for many of the DPC customers.

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Paul Steffany of Stamford, Connecticut submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Department of Enforcement of the Financial Industry Regulatory Authority (FINRA) for allegedly falsifying documents and converting funds for his own personal use. Mr. Steffany entered the securities industry in October 1982. In 2007 Mr. Steffany became associated with FINRA through broker-dealer Raymond James & Associates, Inc. (Raymond James) as a general securities representative (GSR). In May 2014 Mr. Steffany was terminated from Raymond James after violating company policy.

While associated with Raymond James, Mr. Steffany served as the trustee of a testamentary trust established by an estate customer. As the trustee, Mr. Steffany was responsible for paying legal bills, signing tax returns and distributing funds to the beneficiaries of the trust. Mr. Steffany estimated that he spent no more than 43 hours annually dealing with trust related matters.

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Clifford Morgan of Chesterton, Indiana submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Department of Enforcement of the Financial Industry Regulatory Authority for allegedly participating in numerous unauthorized business activities. Mr. Morgan first became associated with FINRA in January 2004 as an Investment Company and Variable Contracts Products Representative, a State Securities Agent, and a General Securities Representative (GSR). From January 2007 through December 2014, Mr. Morgan was associated with FINRA member firm Uhlmann Price Securities (Uhlmann Price).

FINRA found that between November 2011 and December 2014, while associated with Uhlmann Price, Mr. Morgan participated in private securities transactions without written approval from his member firm. Additionally FINRA alleged that Mr. Morgan made material misrepresentations to Uhlmannn Price customers and also failed to comply with FINRA’s requests for information regarding the allegations.

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Qui Lam of Houston, Texas submitted a Letter of Acceptance, Waiver and Consent to the Department of Enforcement of the Financial Industry Regulatory Authority (FINRA) for alleged document falsifications. Ms. Lam first became associated with member firm Pruco Securities in 2000 as an Investment Company Products/Variable Contracts Representative. In 2011, Ms. Lam became a registered representative for UBS Financial Services, Inc. (UBS) but was terminated in 2014 due to allegations of document falsification. Prior to being associated with UBS, Ms. Lam was a representative for Morgan Stanley and Citigroup.

FINRA found, during her association with UBS, Ms. Lam altered documents of a client’s account without their knowledge and consent. While working as an administrator for a wealth management team at UBS in 2014, Ms. Lam altered the risk tolerances of four customer accounts. Ms. Lam allegedly increased the four clients risk tolerances and submitted them without the client’s prior knowledge or consent.

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