John Joseph Kilinofsky Jr., a broker with the Plano, Texas branch of Ameriprise Financial Services, Inc. (Ameriprise), submitted a Letter of Acceptance, Waiver, and Consent (AWC) in which he consented to, but did not admit to or deny, the Financial Industry Regulatory Authority’s (FINRA) findings that he failed to reasonably supervise a registered representative’s outside business activities.
According to FINRA, John Kolinofsky, the branch manager and supervisory principal of the Plano, Texas Ameriprise office, failed to supervise a broker’s participation in private securities transactions and outside business activities in compliance with his firm’s written supervisory policies and procedures. FINRA found that a registered representative, whom Mr. Kolinofsky had a duty to supervise, was allegedly involved in the sale of nearly $1.72 million of preferred shares issued by the biopharmaceutical company BioChemics Inc. FINRA further found that Mr. Kolinofsky knew that the registered representative was engaging in outside business activity with BioChemics and approved the disclosure forms which failed to note the unauthorized securities activity as required by FINRA Rule 2010. Moreover, FINRA found that Mr. Kolinofsky personally invested $10,000 in BioChemics without giving the required written notice to Ameriprise.
Consequently, John Kolinofsky, of Carrollton, Texas, was fined $20,000, suspended from association with any FINRA member in any capacity for one month, and suspended from association with any FINRA member in any principal capacity for three months. The suspensions are in effect from November 19, 2015 through February 18, 2016.
Stockbrokers, financial advisors, and other financial industry professionals have been known to engage in many types of misconduct which violate industry rules. In order to protect investors from broker misconduct, FINRA rules require brokerage firms to establish and implement a reasonable supervisory system. The implementation of these rules requires supervisors to monitor employees to ensure compliance with federal and state securities laws and securities industry rules and regulations or the policies and procedures of the brokerage firm itself. If broker dealers and their supervisors fail to establish and implement these protective measures, they may be held liable to investment account holders for losses flowing from an employee’s misconduct. As a result, investors who have suffered losses stemming from unauthorized securities transactions or other misconduct by their broker or registered representative can bring forth claims to recover damages against broker dealers like Ameriprise Financial, which have a duty to supervise its employees in order to prevent the above-described misconduct.
Have you suffered losses in your Ameriprise Financial investment account due to a stockbroker’s misconduct? 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 financial professionals for unauthorized and/or fraudulent misconduct.
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 post a comment, call (800) 732-2889, send Mr. Pearce an email at firstname.lastname@example.org, and/or visit our website at www.secatty.com for answers to any of your questions about this blog post and/or any related matter.