Failure to Supervise - Page 44 of 46 - Law Offices of Robert Wayne Pearce

459 search results found for “Failure to Supervise”

May 11, 2016

FINRA Slams MetLife with $25 Million Fine for Misrepresenting Variable Annuities

The Financial Industry Regulatory Authority (FINRA) slammed MetLife Securities, Inc. (MetLife) with a $25 million fine for negligent misrepresentations and omissions to customers regarding the costs and guarantees relating to variable annuities. MetLife agreed to the fine, which includes a $20 million fine and $5 million to be paid to customers, without admitting or denying FINRA’s findings. From approximately 2009 to 2014, FINRA found that MetLife falsely told customers that new variable annuities were less costly than the annuities they were replacing. Further, MetLife made the replacement annuities appear more beneficial to the customer when they were typically more expensive. According to FINRA, MetLife sold at least 43 billion in variable annuities which generated $152 million in gross dealer commissions for the firm. Nonetheless, MetLife failed to supervise its registered representatives to ensure they were property trained and informed of the comparative analysis between the variable annuities and the recommended replacement annuities. In fact, FINRA found that MetLife principals approved 99.79% of the variable annuity replacements, even though three-quarters (3/4) of the replacement applications contained at least one misrepresentation or omission.

Mar 24, 2016

Oppenheimer Broker Fined and Suspended by FINRA for Falsifying Letters of Authorization

Stephen Oberman, a registered representative formerly employed with the Chicago, Illinois based Oppenheimer & Co., Inc. (Oppenheimer), submitted a Letter of Acceptance, Waiver, and Consent in which he consented to, but did not admit to or deny, the described sanctions and the entry of the Financial Industry Regulatory Authority’s (FINRA) findings that he falsified signatures on at least 51 letters of authorization (LOAs) requesting fund disbursements from and address changes to a customer’s account. FINRA’s findings stated that while serving as a General Securities Representative at Oppenheimer, Stephen Mark Oberman, of Naperville, Illinois, was assigned to the account of a customer that had a trust with three trustees. Mr. Oberman falsified the trustees’ signatures by photocopying their signatures from other firm documents and cutting and pasting them onto the LOAs. Even after two of the trustees had died, Mr. Oberman continued to falsify their signatures, only disclosing this to Oppenheimer after learning that two of the three trustees were deceased.

Mar 16, 2015

WFG Investments Hit with $700,000 Fine for Due Diligence and Supervision Lapses

WFG Investments, Inc. of Dallas, Texas submitted a Letter of Acceptance, Waiver and Consent in which the firm consented to, but it did not admit to or deny, the described sanctions and the entry of the Financial Industry Regulatory Authority’s (FINRA) findings that it failed to conduct appropriate due diligence and supervision with respect to a private placement offering and that a registered representative sold an investment away from the firm as an approved private securities transaction. FINRA found that in various times between March 2007 and January 2014, “the Firm failed to commit the necessary time, attention and resources to an array of critical regulatory obligations related to its supervision of registered representatives.” Clients who invested in the private placement offering allegedly lost their entire investment. FINRA also found that WFG Investments failed to supervise its representatives, who allegedly recommended the sale of high risk equity and ETF purchases for a retired client with conservative risk tolerance. In addition, WFG Investments failed to supervise a representative’s private securities transactions. According to FINRA, the WFG representative allegedly structured and sold two funds that had substantial investments (exceeding the 50% limit) without investors’ knowledge. All private placement investors allegedly “lost 100% of their investments resulting from a related entity’s fraudulent business practices.” Consequently, WFG Investments was censured and fined $700,000 by FINRA.

Oct 14, 2014

Karen Lee Chafe Fined and Suspended by FINRA for Altering Variable Annuity Documents

The Financial Industry Regulatory Authority (FINRA) has fined and suspended Karen Lee Chafe, a former Berthel, Fisher & Co. Financial Services, Inc. (Berthel Fisher) registered representative in its Melbourne Beach, Florida offices, for admitting to altering customers’ variable annuity withdrawal forms and IRA distribution/withdrawal request forms. According to FINRA, Karen Chafe, a/k/a Karen Lee Linscott, modified and resubmitted withdrawal request forms at least 61 times on behalf of 14 customers. According to FINRA’s Default Judgment, Karen Chafe reused old customer forms, whited out or obscured existing information, added new information, and then submitted the altered forms as originals to Berthel Fisher over a period of six years. Although Karen Chafe was authorized to make the withdrawals and distributions, she did not have the customers’ authorization to submit altered forms. Karen Chafe has been assessed a deferred fine of $5,000.00 and suspended from associating with any FINRA member in any capacity for a year. The suspension is in effect from June 16, 2014 through June 15, 2015.

Apr 11, 2014

UBS Puerto Rico Investor Claims Bond Funds Unsuitable and Misrepresented

In 2002 and 2003, the client inherited what she understood to be bonds and mutual funds from her parents’ UBS PaineWebber accounts when they passed away. The client did not know the true nature or risk of the investments that she had inherited and held in her account. She thought she actually owned bonds that would always pay interest until they matured. Neither UBS Puerto Rico nor her UBS Puerto Rico Stockbrokers ever gave her a full explanation of what type of investments she really owned, which were closed-end funds and that what she actually owned was shares of the closed-end funds (like common stock shares) that only paid dividends at the manager’s discretion. She also didn’t know that these were leveraged, illiquid investments which were very risky.

Mar 25, 2014

FINRA Accuses Karen Lee Chafe of Altering Variable Annuity Documents

The Financial Industry Regulatory Authority (FINRA) has filed a complaint against Karen Lee Chafe, a Berthel, Fisher & Co. Financial Services, Inc. (Berthel Fisher) representative in its Melbourne Beach, Florida offices of altering at least 61 variable annuity withdrawal forms and IRA distribution/withdrawal request forms for over 14 customers. According to FINRA, Ms. Chafe obscured information, added new information to the forms, and then submitted the forms as new forms being filed for customers at her brokerage firm. The recycled distribution/withdrawal request forms were altered in various ways and were not re-signed by any of the customers. Ms. Chafe allegedly admitted to FINRA staff members her misconduct. FINRA claims the altered forms caused Berthel Fisher and the annuity company to maintain inaccurate books and records. Ms. Chafe has been charged with multiple violations of NASD Conduct Rule 2110 and FINRA Rule 2010.

Jun 29, 2021

Amarillo, Texas FINRA 8210 Defense Lawyer

Do You Need a FINRA 8210 Defense Attorney? You may have read that Byron Pat Treat of Amarillo, Texas was barred by the Financial Industry Regulatory Authority (“FINRA”) from working in the securities industry because he failed to comply with FINRA Rule 8210 and 2010. In 1989, Byron Pat Treat joined Great Nation Investment Corporation while registered as a General Securities Representative and a General Securities Principal. According to the findings, FINRA sent a request to Treat to produce documents and information in connection with their investigation into whether Treat reasonably supervised the sale of illiquid investments. The findings state that Treat responded during a phone call with FINRA on February 9, 2021, stating that he received, acknowledged, and refused to provide any of the requested documents and information. Byron Pat Treat is subject to FINRA’s jurisdiction because he is currently associated with and registered through a FINRA member firm. FINRA Rule 8210(a)(1) states, in relevant part, that FINRA staff shall have the right to “require a member, person associated with a member, or any other person subject to FINRA’s jurisdiction to provide information orally, in writing, or electronically…with respect to any matter involved in the investigation, complaint, examination, or proceeding.” A failure to comply with a request for documents and information issued pursuant to FINRA Rule 8210 is a violation of FINRA Rule 2010, which requires associated persons to “observe high standards of commercial honor and just and equitable principles of trade.” Unfortunately, Byron Pat Treat might have avoided that FINRA 8210 bar from the securities industry with a skilled and experienced FINRA 8210 defense attorney. 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 FINRA rules and procedures, the securities laws and the appropriate sanction for the alleged misconduct but also has an excellent reputation and credibility with the FINRA attorneys to negotiate the best outcome. Free Initial Consultation With FINRA 8210 Defense Attorney Serving Financial Advisors Throughout Amarillo, Texas 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. Attorney Pearce’s FINRA defense skills are highly regarded throughout Texas and across the nation. For dedicated representation by an attorney with over 40 years of experience and success in all kinds of FINRA disputes serving Texas citizens, contact the firm by phone at 561-338-0037, toll free at 800-732-2889, or via e-mail.

Jul 31, 2020

Dakota Securities International Expelled & Former Owner Bruce Martin Zipper Barred for Misconduct

Dakota Securities International (Dakota) and Bruce Martin Zipper (Mr. Zipper) appealed a National Adjudicatory Council (NAC) decision to the Securities and Exchange Commission (SEC). The Hearing Panel imposed three expulsions on Dakota for allegedly failing to maintain accurate books and records, failing to supervise, and allowing Mr. Zipper to associate with them and engage in activities requiring registration while suspended. The Hearing Panel also imposed two bars on Mr. Zipper for associating with Dakota and engaging in the particular activities while suspended and intentionally misidentifying the representative of record on customer transactions. In 2004, Mr. Zipper founded Dakota and was the majority owner until January 2018, when he sold his ownership. According to the NAC findings, Mr. Zipper executed then later tried to withdraw from an AWC that was final and non-appealable due to his failure to disclose three unsatisfied judgments on his Form U4. The findings stated that FINRA informed Mr. Zipper of his suspension, and during his absence he allegedly arranged for Dakota to continue operations without him for the three months. During the same period, Dakota did not restrict Mr. Zipper’s access to the firm’s email system or to the firm’s trading system in which he engaged and recommended transactions while suspended. In addition to the NAC findings, Mr. Zipper admitted that he intentionally misidentified the representative of record on hundreds of trades caused Dakota to maintain inaccurate books and records. Dakota Securities International was expelled from FINRA membership and Mr. Zipper was barred from association with any FINRA member in all capacities.

Sep 29, 2017

FINRA Bars Morgan Stanley Broker for Knowingly Misrepresenting Customer Account Values

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.

Jun 28, 2017

Legend Equities Broker Named in FINRA Complaint for Unsuitable Annuity Replacements

Walter Marino, a previously registered broker with Legend Equities Corporation, was named a Respondent in a Financial Industry Regulatory Authority (FINRA) complaint alleging that he recommended unsuitable variable annuity replacements (also known as exchanges) to two customers, allegedly causing one customer to incur a surrender charge of $85,523.23. According to the FINRA complaint, Walter Joseph Marino, of Dix Hills, New York, had no reasonable basis for his recommendation of replacements for his customers’ non-qualified variable annuities. The complaint alleges that both customers suffered substantial losses as a result of his recommendation. For instance, one customer incurred significant tax liabilities due to Mr. Marino’s failure to use the tax-free exchange available under the IRS Code. Further, as mentioned above, another customer is alleged to have suffered a surrender charge of more than $85,000. Mr. Marino, on the other hand, allegedly received commissions of approximately $60,000 for recommending the unsuitable transactions.

Search Results

459 search results found for “Failure to Supervise”