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Jason Likens, a former registered representative associated with Oppenheimer & Co., Inc. (Oppenheimer), submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) in which he consented to, without admitting or denying, the findings that he borrowed money from his customers and did not begin to repay the loans until repeated requests were made.

Jason Hunter Likens, of Asheville, North Carolina, allegedly approached an elderly customer with significant health issues to borrow $5,000 on two separate occasions in a month’s time.  The customer provided the loans to Mr. Likens in both instances.  Mr. Likens failed to repay the loans on schedule and did not do so until the customer and his family made repeated requests.  FINRA found further that Mr. Likens approached another customer to borrow $13,500 and that customer, too, provided the loan.  Once again, FINRA found that Mr. Likens failed to repay the loan until the customer made repeated requests.  Continue reading →

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David Gott, a representative formerly employed with Ausdal Financial Partners, Inc. (Ausdal Financial), 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) findings that he engaged in outside business activities without his firm’s approval.

FINRA’s findings state that while employed by Ausdal Financial, David Glenn Gott, of Tipton, Iowa, sold at least $546,000 in private equity and debt investments to four individuals.  Ausdal’s policies and procedures regarding private securities transactions prohibited registered representatives from engaging in such transactions.  FINRA found that Mr. Gott neglected to provide the necessary written notice to his member firm prior to the private sales.  According to FINRA, although Mr. Gott did not personally receive compensation for the sales, his company benefited from them.  Mr. Gott was assessed a deferred fine of $5,000 and suspended from association with any FINRA member in any capacity for six months. The suspension was in effect from July 17, 2017 through January 16, 2018. Continue reading →

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Jeffrey Delaney, a broker formerly registered with Pruco Securities, LLC, 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 forged a customer’s signature on life insurance applications without the customer’s knowledge or consent.

According to FINRA, Jeffrey Allen Delaney Jr, of Peachtree City, Georgia, forged his customer’s electronic signature on seven forms related to the exchange of an existing life insurance policy for a new one.  Mr. Delaney then submitted the forms for processing.  FINRA found that Mr. Delaney never had the customer’s knowledge or consent to forge the signature.  FINRA also found that Mr. Delaney willfully reported a false address on his Form U4.  Mr. Delaney listed his incorrectly as South Carolina, allegedly to avoid Georgia’s insurance licensing requirements. Continue reading →

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Thomas Lawrence, a former registered representative associated with Ameritas Investment Corp. (Ameritas), submitted an Offer of Settlement to the Financial Industry Regulatory Authority (FINRA) in which he consented to, without admitting or denying, the findings that he borrowed money from a 96 year old customer and has not repaid the loan.

Thomas H. Lawrence III, of Chapel Hill, Tennessee, allegedly borrowed more than $39,000 from one of his customers, a 96 year old retiree.  The elderly customer allegedly agreed to provide the loan and Mr. Lawrence drafted and signed a promissory note stating the terms of repayment.  According to FINRA, Mr. Lawrence did not repay any portion of the loan, nor did he have any discussion with the customer about repaying the loan.  Further, FINRA found that Mr. Lawrence hasn’t even spoken to the elderly customer since early 2014.  Mr. Lawrence never notified his member firm before obtaining the loan, as it was prohibited except for immediate family members. Due to the afore-mentioned misconduct, Thomas Lawrence was suspended from association with any FINRA member for two years, fined $5,000, and ordered to pay restitution of $41,332.65, plus interest to the affected customer.  Continue reading →

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Roger Zullo, a former registered representative with LPL Financial LLC, has been barred by the Financial Industry Regulatory Authority (FINRA) for refusing to produce information and documents requested by FINRA in connection with an investigation into allegations of fraud, falsifying client suitability profiles and unsuitable variable annuity sales.  FINRA’s investigation arose from a complaint, and subsequent Consent Order, by the Massachusetts Securities Division against Mr. Zullo and LPL Financial.

FINRA began an investigation in January 2017 following allegations made in the complaint filed by the Massachusetts Securities Division.  That complaint alleged that Mr. Zullo, of Boston, Massachusetts, “fabricated the financial suitability profiles of numerous LPL clients, selling them scores of large, illiquid, unsuitable, high-commission variable annuities, at substantial upfront profits to himself and LPL.”  Further, the complaint alleged that Mr. Zullo prematurely switched out his clients’ existing annuities (which were also sold by Mr. Zullo), caused unnecessary surrender charges, and disregarded his clients’ investment profiles at an enormous profit to himself and LPL. The complaint states, “Over the course of three years, Zullo and LPL received more than $1,825,000 in variable annuity commissions alone; of this amount, more than $1,791,000, or 98%, represented commissions from the sale of the same annuity product, the Polaris Platinum III (B Shares) variable annuity.” Continue reading →

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Craig Gary Langweiler, a Philadelphia, Pennsylvania-based registered representative formerly employed with Meyers Associates, L.P., n/k/a Windsor Street Capital, was named a Respondent in a Financial Industry Regulatory Authority (FINRA) complaint alleging that he excessively traded the account of his customer, generating high commissions for himself and substantial losses for his customer.

According to the FINRA complaint, Mr. Langweiler executed 257 trades in his customer’s account during the relevant period, which was a mere 193 days.  FINRA alleges that Mr. Langweiler generated approximately $27,092 in commissions, whereas his customer incurred losses in excess of $33,000.  FINRA found that Mr. Langweiler exercised control over the customer’s account through his use of discretion, for which he allegedly never sought, nor obtained, written authorization.  Continue reading →

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Kim Dee Isaacson, a former registered representative with Morgan Stanley, submitted an Offer of Settlement to the Financial Industry Regulatory Authority (FINRA) in which he consented to, but did not admit to or deny, FINRA’s findings that he knowingly misrepresented his customer’s account value by more than $3.1 million and willfully executed trades in his customer’s accounts despite express orders not to do so.

During the relevant period, Kim Dee Isaacson, of Farmington, Utah, earned nearly $400,000 in commissions and fees from his customer’s accounts, which were valued at approximately $27 million.  Although Mr. Isaacson and his client spoke on the phone nearly every day regarding the accounts’ performance, Mr. Isaacson began providing false and inflated account values to hide the accounts’ losses.  According to FINRA, Mr. Isaacson’s customer believed his accounts held $3.1 million more than their actual value because of his misrepresented account valuations.  Further, FINRA found that Mr. Isaacson continued to purchase securities and long-term bonds despite his customer’s instructions not to do so.  FINRA also found that Mr. Isaacson engaged in unauthorized trading in the accounts, effecting approximately 360 transactions without consent.  Consequently, Kim Dee Isaacson was permanently barred from association with any FINRA member in any capacity.  Continue reading →

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The Financial Industry Regulatory Authority (FINRA) announced today that it ordered Morgan Stanley Smith Barney LLC (Morgan Stanley) to pay $13 million in fines and restitution for failing to supervise the sales of unit investment trusts (UITs).

FINRA found that from January 2012 through June 2015, hundreds of Morgan Stanley brokers executed short-term UIT rollovers in thousands of customer accounts.  Further, FINRA found that Morgan Stanley failed to adequately supervise its representatives’ sales by failing to provide sufficient guidance or training to detect unsuitable short-term UIT trading.  Continue reading →

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Zena Yofonovich, a former registered representative with Pruco Securities, LLC, consented to, but did not admit to or deny, the Financial Industry Regulatory Authority’s (FINRA) findings that she borrowed money from an elderly customer, neglected to notify her member firm or obtain pre-approval for the loan, and has not repaid the loan.

Zena Yofonovich, of Glenview, Illinois, allegedly borrowed $63,500 from an elderly Pruco customer, withdrawing the funds from the customer’s variable annuity held at the firm.  Ms. Yofonovich didn’t notify Pruco of the loan, nor did she obtain the necessary firm pre-approval.  Further, FINRA states that Ms. Yofonovich has not repaid the loan.  Due to the afore-mentioned misconduct, Zena Yofonovich was suspended from association with any FINRA member for two months.  The suspension was in effect from June 5, 2017 through August 4, 2017. Continue reading →

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David Panetta, a representative formerly employed with Allstate Financial Services, LLC (Allstate), 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) findings that he engaged in outside business activities without his firm’s approval.

FINRA’s findings state that while employed by Allstate, David M. Panetta, of Clark, New Jersey, sold nine unapproved insurance products through an entity unaffiliated with Allstate.  Mr. Panetta allegedly received $12,000 in compensation for the prohibited sales, but failed to disclose the sales or his compensation to his member firm.  Further, FINRA found that Mr. Panetta falsely answered “no” on the firm annual attestations to the questions asking if he had any outside business activities or accepted compensation from any unapproved entity.  Mr. Panetta was assessed a deferred fine of $7,500 and suspended from association with any FINRA member in any capacity for two months. The suspension was in effect from June 5, 2017 through August 4, 2017. Continue reading →