John Pena of Margate Florida was sanctioned by the Financial Industry Regulatory Authority (FINRA) for accepting a client loan without his firm’s permission. Mr. Pena first became registered at the Concord Equity Group, LLC (CEG) as a General Securities Representative. FINRA found that Mr. Pena borrowed $20,000 from two customers without his firm’s approval. This was a direct violation of his employer member firm’s written procedures and NASD Rule 8210, NASD Conduct Rule 8210, and FINRA Conduct Rule 2010. According to FINRA, Mr. Pena failed to repay the loan, and when asked to provide documentation, Mr. Pena failed to timely and completely fulfill FINRA’s request. Mr. Pena agreed to settle the FINRA sanctions, without admitting or denying them, and was permanently barred from any association with any FINRA member.
Do You Need a FINRA 8210 Attorney?
You may have read that John Pena of Margate Florida was permanently barred by FINRA from working in the securities industry because he violated FINRA Rule 8210. He could have avoided that FINRA 8210 bar from the securities industry with a skilled and experienced FINRA 8210 defense attorney.
My guess is that you are reading this article because you probably just received a letter from FINRA via certified mail that states:
You are notified that the FINRA office is conducting an inquiry to determine whether violations of the federal securities laws or FINRA, NASD, NYSE, or MSRB rules have occurred.
In the next paragraph, you are being requested, “Pursuant to FINRA Rule 8210,” to provide a slew of documents and/or to appear at a FINRA office to give “On-the-Record” testimony and then you read the warning:
Under FINRA Rule 8210, you are obligated to respond to this request fully, promptly and without qualification. You are also obligated to supplement or correct any response that you later learned to have been incomplete or inaccurate. If you withhold any responsive documents or information, you must specifically identify what you are withholding and state the basis for your doing so. Any failure on your part to satisfy these obligations could expose you to sanctions, including a permanent bar from the securities industry.
To a FINRA registered representative, who has never received such a letter in their career, it can be intimidating and cause a great deal of anxiety.
You are probably asking yourself: Why did I get this letter? What does it mean to my career? What should I do or not do? First, you must not ignore the letter because if you do and are currently registered and still working with a broker dealer, you will be suspended, and if you still do not comply with the request, you will be permanently barred from working in the securities industry just like John Pena, above. Second, if you are still working for a brokerage firm, you must notify the firm and provide a copy of the FINRA letter to your immediate supervisor and/or compliance officer. Third, you will need advice from an experienced FINRA defense lawyer on how to respond to the FINRA inquiry and protect you from sanctions. If your employer is not going to supply legal counsel free of any conflict of interest or you are no longer registered and working for any firm, you will need to hire your own FINRA defense attorney.
This FINRA letter marks the first stage and hopefully the last of any FINRA inquiry into a particular matter. At this point, you have not been accused of any violation of the law or any securities industry rule, and there will be no black marks on your FINRA record in the Central Record Depository (“CRD”) or on the FINRA BrokerCheck website. You want to keep it that way!
As your FINRA defense lawyers, we will immediately reach out to FINRA, obtain a reasonable extension of time to comply with request for documents and/or date of your On-the-Record testimony to investigate the issue, and gather and review the information requested. We will determine the trigger event and/or nature of the inquiry, such as the following:
- Automated Surveillance Program flagging of potential insider trading, layering, algorithm gaming, wash sales, marking-the-close and open, front running, etc.
- Form U4 or U5 filing disclosing: customer complaints; arrests, criminal charges and convictions; Liens, Bankruptcies, and compromises with creditors; and/or outside business activities.
- Customer Complaints made directly to FINRA through its Hotline.
- Actions by or referrals from other regulatory agencies, like the SEC or state securities regulators.
The less interaction you have with the FINRA investigator, and the more interaction your FINRA defense attorney has with the investigator the less harm you will inflict upon yourself.
Sometimes the list of documents requested and/or questions asked are numerous and burdensome. Unfortunately, you simply cannot refuse to comply with the FINRA 8210 request and expose yourself to sanctions for non-compliance. As your FINRA defense lawyers, we will make sure that the FINRA investigator is not over-reaching and making unreasonable requests for documents, which you will have to supply; not only documents in your possession and custody, but you will also be required to supply documents within your “control,” such as bank statements and other records and/or tax returns in the files of your bank or accountant. As your FINRA defense attorneys, we will negotiate the scope of the document production with the investigator to ensure you are not being harassed by the regulator and producing only what is necessary for them to conduct their investigation.
If you are being scheduled for an On-the-Record (“OTR”) examination, FINRA’s equivalent to a deposition without any rules, we will prepare you for the examination and advise you on your limited rights and how to answer the questions truthfully to lessen the consequences of your testimony. In the end, it is our goal as your FINRA defense lawyer to end the inquiry after the OTR in the shortest amount of time and at the least expense.
Unfortunately, in many cases, the FINRA investigators and attorneys already have the evidence they need and determined that a violation of the securities laws or industry rules has occurred and are determined to bring an enforcement action. So, it is important, early on, to have a FINRA defense attorney advise you on how not to make matters worse and resolve the dispute with the least amount of sanctions which could range from censures to fines, suspensions, permanent bars, and/or referrals to federal or state prosecutors. You will need an experienced FINRA defense lawyer who not only has knowledge of the securities laws and industry rules but the appropriate sanction for the alleged misconduct, as well as the reputation and credibility with the FINRA attorneys necessary to negotiate the best outcome.
Experienced FINRA Defense Lawyer Serving All of Margate Florida
Attorney Pearce’s defense skills are highly regarded throughout Margate Florida and across the nation. He began his career with the United States Securities and Exchange Commission (SEC) in 1980. Thereafter, he moved to Fort Lauderdale, Florida and has expanded his nationwide SEC defense law practice to include commodities law and the defense of United States Commodity Futures Trading Commission (CFTC), Florida Office of Financial Regulation (FL-OFR) and FINRA investigations and enforcement proceedings.
He has earned the distinguished AV Preeminent peer rating through Martindale-Hubbell, the highest rating possible, and he is one of Thomson Reuters Florida Super Lawyers for Securities Litigation.
Attorney Pearce is one of the few attorneys who has not only single handedly beat the SEC’s team of lawyers, but recovered his clients’ attorney fees and litigation costs incurred in the defense of the government’s flawed investigation and enforcement action.
Free Initial Consultation With FINRA Defense Attorney Serving Financial Advisors Throughout Margate Florida And Nationwide
The Law Offices of Robert Wayne Pearce, P.A. understands what is at stake in FINRA securities law matters and works tirelessly to secure the best possible result for you and your case. Mr. Pearce provides a complete case review, identifies the strengths and weaknesses of your case, and fully explains all of your legal options. The entire law firm works to ensure that you thoroughly understand the ins and outs of the legal process to give you complete peace of mind knowing that you have chosen the best possible representation for your case.
For dedicated representation by a law firm with over 40 years of experience and success in all kinds of FINRA disputes serving Margate Florida citizens, contact the firm by phone at 561-338-0037, toll free at 800-732-2889, or via e-mail.