Ronald Cohen of Boca Raton, Florida submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Department of Enforcement of the Financial Industry Regulatory Authority (FINRA) for allegedly engaging in outside business activities without providing prior written notice to his firm.
Cohen entered the securities industry in July 1992. Between 2009 through September 2014, Cohen was a General Securities Representative with Morgan Stanley. Cohen voluntarily left Morgan Stanley in September 2014 while under investigation for failing to disclose outside business arrangements.
FINRA found that between 2011 and 2014, Cohen engaged in three unauthorized outside business activities. Cohen allegedly helped a Morgan Stanley customer establish GTR, a limited liability corporation located in New York. FINRA further alleged that Cohen helped the same client manage a New Jersey private golf course and another limited liability company located in New Jersey that acted as a high-end wholesaler of specialty rugs, art and furniture. FINRA found that Cohen’s duties for these entities included actively running and managing their finances, paying bills, purchasing equipment and hiring staff. Over the three year period in which Cohen was associated with these businesses, he received approximately $466,200 in compensation.
Cohen did not provide prior written notice to Morgan Stanley for engaging in any of these outside business activities and even made misrepresentations to the firm when filling out annual compliance questionnaires. For these alleged actions, Cohen violated FINRA Rules 3270 and 2010.
Without admitting or denying the FINRA findings, Cohen agreed to the sanctions and was ordered to pay a $10,000 fine and suspended from association with any FINRA member in any capacity for four months.
Stockbrokers have been known to engage in many types of practices which violate industry and firm rules, practices, and procedures. In order to protect customers from stockbroker misconduct, FINRA rules require broker-dealers like Morgan Stanley to not only establish and implement a reasonable supervisory system but enforce their rules, policies and procedures. The implementation of the rules require supervisors to monitor employees to ensure they comply with federal and state securities laws, securities industry rules and regulations, and the firms, such as Morgan Stanley own policies and procedures. If broker dealers and/or their supervisors do not establish, implement and enforce these protective measures, they may be liable to investors for damages which flow from the misconduct. As a result, investors who have suffered losses because of their stockbroker’s unlawful or prohibited conduct can file a claim to recover damages against broker dealers like Morgan Stanley, which should consistently oversee its employees in order to prevent stockbroker misconduct.
Have you suffered losses in your Morgan Stanley investment account due to your 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 stockbrokers for unsuitable recommendations, misrepresentations, and/or other unauthorized and prohibited conduct.
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 email@example.com, 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.