Jody Ethan Thompson of Seaford, New York submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) in which he allegedly exercised discretionary trading and made unsuitable recommendations in violation of NASD Rule 2510 and FINRA Rules 2111 and 2010.
From July 2015 to February 2019, Jody Ethan Thompson was registered with Alexander Capital as a General Securities Representative. According to the FINRA findings, Thompson made unsuitable recommendations to three different customers without understanding the potential risks and rewards of the various offerings. The findings stated that Thompson did not understand the restrictions on transfer and withdrawal of the investments, how the interest payments would be made to investors or the fee structure of the investments because he did not perform reasonable diligence. The FINRA findings also stated that Thompson allegedly exercised discretion by placing 40 trades in a customer’s account without written authorization from the customer or from Alexander Capital.
NASD Rule 2510(b) prohibits registered representatives from exercising discretion in a customer’s account unless the customer has given prior written authorization to the registered representative, and the registered representative’s member firm has provided prior written acceptance of the account as discretionary. FINRA Rule 2111 requires that a registered representative have a reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer.
Without admitting or denying FINRA’s findings, Jody Ethan Thompson was suspended from association with any FINRA member in all capacities for five months. The suspension is in effect from March 2, 2020 through August 1, 2020.
Stockbrokers have been known to engage in many practices that may violate industry and firm rules, practices, and procedures. In order to protect investors from stockbroker misconduct, FINRA rules require brokerage firms to establish and implement a supervisory system. The implementation of these industry rules requires supervisors to monitor their employees to ensure compliance with federal and state securities laws, securities industry rules and regulations, and the brokerage firm’s own policies and procedures. If broker-dealers and/or their supervisors fail to establish and implement these protective measures, they may be liable to investors for damages which flow from the broker’s misconduct. Therefore, investors who have suffered losses stemming from excessive, unsuitable trading, and/or other misconduct by their broker can file claims to recover damages against broker-dealers, like Alexander Capital, which should consistently oversee its brokers’ activities in order to prevent the above-described misconduct.
Have you suffered losses in your Alexander Capital account due to excessive, unsuitable trading by your broker? Was Jody Ethan Thompson your stockbroker? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against Alexander Capital stockbrokers who may have engaged in broker misconduct and caused investors’ losses.
The most important of investors’ rights is the right to be informed! This Investors’ Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 40 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to protecting investors’ rights throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at email@example.com for answers to any of your questions about this blog post and/or any related matter.