NYLIFE Securities - Law Offices of Robert Wayne Pearce

Mar 6, 2020

NYLife Securities Censured and Fined for Misconduct

NYLife Securities submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) in which they allegedly failed to enforce its written supervisory procedures in violation of NASD Rule 3010(b) and FINRA Rule 3110(b), and consequently FINRA Rule 2010. NYLife Securities is a retail broker-dealer that has been a member of FINRA since 1970. According to the findings, NYLife failed to enforce it procedures for supervising the suitability of sales of higher risk mutual funds that were subject to volatility. According to those procedures, the firms representatives were required to reallocate or change risk tolerances and investment objectives for portfolios that were over-concentrated in higher risk securities. However, FINRA alleged that the firm did not seek the customers input to adjust the risk tolerances and investment objectives to accommodate sales of higher-risk mutual funds due partly to the workload of the reviewers and their supervisor, which prevented them from reasonably investigating each alert that Respondent’s automated surveillance generated. The findings stated that the adjustments permitted numerous customers to be over-concentrated in their portfolios, sustaining losses of $1.4 million.

Feb 28, 2020

Former NYLIFE Representative Timothy R. Millis Suspended for Unsuitable Recommendations

Timothy Robert Millis of Lake Orion, Michigan submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) in which he has been suspended for allegedly making unsuitable recommendations in violation of FINRA Rules 2111 and 2010. In 2002, Millis joined NYLIFE Securities as General Securities Representative and Insurance Agent. According to FINRA, Millis recommended 66 unsuitable short-term Class A mutual fund share transactions in ten customers’ accounts. FINRA stated that the ten customers were charged approximately $174,725 in upfront sales charges and five customers accrued losses totaling approximately $33,391. FINRA also found that Millis recommended to another customer an unsuitable switch from a variable annuity to Class A mutual fund shares which resulted in a surrender charge of $14,866 and upfront sales charges of $15,340. In addition, FINRA stated that Millis did not have a reasonable basis to believe these recommendations were suitable therefore violated the customer-specific suitability obligation.

Feb 3, 2020

Former NYLife Representative Barred for Unauthorized Transactions

Cristina Sabengsy, a former registered representative with NYLife Securities LLC, submitted a Letter of Acceptance, Waiver, and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) and has been barred for allegedly forging signatures in order to facilitate unauthorized transactions, violating FINRA Rule 2010. In February 2016, Cristina Sabengsy registered as an Investment Company and Variable Contracts Products Representative with NYLife Securities LLC. According to FINRA, from April 2016 through October 2017, Sabengsy forged the signatures of two of her insurance customers on fourteen insurance and variable annuity policy documents without permission. The findings stated that neither customers were made aware or consented to the transactions related to purchasing a variable annuity for one customer and converting the other customer’s term life insurance policy to a whole life insurance policy. The findings also stated that Sabengsy forged signatures on at least 10 other documents in order to receive commission. Although these were authorized transactions, the customers did not authorize the signing of their names. On March 7, 2018, the Firm filed a Uniform Termination Notice for Securities Industry Registration (“Form U5”) terminating Sabengsy.

Jan 23, 2019

NYLife Securities Broker Suspended for Unsuitable Recommendations

David Raymond Colflesh submitted a Letter of Acceptance, Waiver, and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) in which he was suspended and ordered to pay 34,546.98 in deferred disgorgement of commissions received. David Colflesh, of Tarkio, Missouri, was registered with NYLife Securities from 1982 until 2016 as a variable contract representative and a direct participation programs representative. From October 2014 to July 2015, Mr. Colflesh allegedly recommended nondiversified mutual funds to ninety customers without having basis to believe that his recommendations were suitable because he did not understand the funds’ complexity or potential risks. According to FINRA, the customers purchased 250 funds worth $4.5 million and Mr. Colflesh earned $34,546.98 in commissions. FINRA also stated Mr. Colflesh’s recommendations exposed his customers to a level or risk that was unsuitable, given their investment objectives. Based on the foregoing, FINRA concluded David Colflesh violated FINRA Rules 2111 and 2010.

Jan 14, 2019

Former NYLife Representative Suspended for Privately Settling Complaint

Jose Luis Paula submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) for allegedly violating FINRA Rule 2010. Jose Paula joined NYLife Securities LLC as an Investment Company and Variable Contracts Products Representative in March 2010 until his termination in January 2017. According to FINRA, Paula attempted to settle a customer complaint related to losses in her account by agreeing to refund her the total principal associated with the trades. The findings stated that when Mr. Paula issued a check in the amount of $10,000, he told the customer not to cash it until he could fund his checking account, but never did. The findings also stated that Mr. Paula never informed his firm of the complaint nor did he obtain authorization to settle the complaint, thereby violating FINRA Rule 2010.

Mar 10, 2017

Former NYLife Securities Broker Barred for Converting Client Funds

Marc Bushey, of Plympton, Massachusetts, has been permanently barred from acting as a broker or otherwise associating with firms that sell securities to the public. Mr. Bushey 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 allegedly converted a client’s trust funds for his personal use. According to FINRA, Marc Donald Bushey, a broker formerly employed with NYLife Securities LLC, assisted his customer with creating a trust in 2007 to benefit the customer’s children. The customer and a third party were appointed as co-trustees. Mr. Bushey then assisted the customer’s trust in opening an account with NYLife Securities, where he served as the registered representative on the account. FINRA found that between November 2015 and September 2016, Mr. Bushey wrote at least seven checks from the trust’s account, made them out to “cash,” and deposited them into his personal account. Mr. Bushey then used the funds for his personal use, according to FINRA. He never had authorization from the trustees for his actions.

Apr 11, 2016

NYLIFE Securities Broker Barred by FINRA for Forging Customer’s Signature

Michael Roger Griffith, a broker formerly employed by the Timonium, Maryland branch of NYLIFE Securities, LLC, submitted a letter of Acceptance, Waiver, and Consent (AWC) in which he consented to, but did not admit to or deny, the described sanction and the entry of the Financial Industry Regulatory Authority’s (FINRA) findings that he forged a customer’s signature on fictitious life insurance applications without the customer’s knowledge or consent. Michael Griffith, of Middle River, Maryland, was found by FINRA to have submitted fictitious life insurance applications in which he forged the customer’s signature and set up an automatic bank account debit for the policies. Mr. Griffith is alleged to have done all of this without the customer’s knowledge or permission. As a result of Mr. Griffith’s fraudulent misconduct, the customer’s account was debited $1,220 which prompted the customer to contact NYLIFE Securities. The fake policies were then canceled, and the customer was repaid the money. Mr. Griffith’s actions caused him to be in violation of FINRA Rule 2010. Consequently, FINRA barred him from association with any FINRA member in any capacity.

Sep 16, 2015

Tallahassee Florida Edward Jones Representative Barred for Misusing Customer Funds

William Hardy of Tallahassee, Florida submitted a Letter of Acceptance, Waiver and Consent (AWC) to The Department of Enforcement of the Financial Industry Regulatory Authority (FINRA) for allegedly misusing customer insurance premium funds. Hardy became registered in December 1985 and in 2002 became registered with NYLife Securities LLC (NYLife). Hardy was terminated from NYLife on March 12, 2014. FINRA found that from May 5, 2013 through July 17, 2013, while still associated with NYLife, Hardy misused customer insurance premium funds causing the clients policies to lapse.

Apr 27, 2015

Former NYLIFE Securities Broker Barred by FINRA for Converting Funds of an Elderly Investor

William Robert Kinyon, a former registered representative with the Castleford, Idaho branch of NYLIFE Securities LLC (NYLIFE Securities) submitted a Letter of Acceptance, Waiver and Consent in which he consented to, but did not admit to or deny, the entry of the Financial Industry Regulatory Authority’s (FINRA) findings that he converted funds from an elderly customer’s account for personal use. According to FINRA, William Kinyon’s elderly brokerage customer told him that she wanted to deposit $3,000 into one of her variable annuity accounts. Mr. Kinyon, however, deposited the check into his personal checking account and allegedly used the funds to make multiple personal purchases at stores such as Walmart and Costco.