Leonard Goldberg of Rancho Mirage, California submitted an offer of settlement to the Department of Enforcement of the Financial Industry Regulatory Authority (FINRA) for an alleged mutual fund “switching” scheme. In June 1986, the NYSE fined Mr. Goldberg $25,000 and suspended him for misconduct similar to these FINRA allegations. Mr. Goldberg acted as a GSR, GSP and OP for FINRA member firm Newport Coast Securities Inc. (Newport) from October 22, 2010 through his termination in November 2014 for failing to follow procedures.
FINRA investigators found that from August 2007 through August 2014, while associated with Newport and J.P. Turner & Company, LLP, Mr. Goldberg caused over $123,600 in losses to five customers in connection with 300 mutual fund and Exchange Traded Fund (ETF) transactions that netted him $77,900 in ill-gotten gains. FINRA alleged that over the five year period, Mr. Goldberg engaged in a practice of fraudulent and unsuitable short term switches of Class A mutual funds in client accounts.