Popular Securities - Law Offices of Robert Wayne Pearce

Mar 1, 2017

Popular Securities Broker Fined and Suspended for Unauthorized Discretionary Trades

Manuel Mejia-Gomez, a former registered representative with Popular Securities, LLC, 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 executed three unauthorized transactions in a customer’s accounts; failed to follow a customer’s instructions to liquidate a particular security; and engaged in discretionary trading without written authorization in the accounts of three customers. According to FINRA, Manuel Mejia-Gomez, of San Juan, Puerto Rico, executed three unauthorized transactions in a customer’s account which caused the customer to complain to Popular Securities, who then cancelled the transactions. FINRA alleges further that instead of following his customer’s instructions to liquidate a specific bond, Mr. Mejia-Gomez allegedly consulted with his customer’s employee who had no authority to make trading decisions. Mr. Mejia-Gomez used the instructions of this unauthorized employee to liquidate a different bond than was instructed by his customer.

Dec 1, 2016

Merrill Lynch Hit with $7 Million Fine for Failing to Supervise Securities-Backed Leveraged Accounts

The Financial Industry Regulatory Authority (FINRA) has hit Merrill Lynch, Pierce, Fenner & Smith, Inc. (Merrill Lynch) with a fine of more than $7 million for failing to properly supervise its customers’ use of leverage in loan management accounts and for improper supervision regarding unsuitable and highly overconcentrated accounts invested in Puerto Rican municipal bonds and closed-end bond funds. Without admitting or denying the charges, Merrill Lynch consented to FINRA’s findings that it failed to adequately educate its representatives about its loan management accounts (LMAs) or train them on the differences between purpose and non-purpose LMAs. LMAs are lines of credit that enable customers to borrow money from, in this case, Bank of America (the owner of Merrill Lynch) using the securities in their accounts as collateral. FINRA notes that Merrill Lynch brokers earned compensation if the customers used the line of credit. Merrill Lynch must pay $6.25 million for its failure to supervise these LMAs.

Feb 18, 2015

Popular Securities Fined By FINRA for Failure to Supervise Puerto Rico Bond Fund Investments

Popular Securities, Inc. n/k/a Popular Securities, LLC, was fined $125,000 by the Financial Industry Regulatory Authority (FINRA) for failure to supervise violations involving over-concentration of investments in Puerto Rico municipal bonds and closed-end bond funds in many of its customers’ accounts. Without admitting or denying the findings, Popular consented to the sanctions and to FINRA’s findings that between July 1, 2011 and June 30, 2013, it failed to supervise its customers’ Puerto Rico bond fund investments, even after the bond rating had been downgraded to junk bond status. Following the junk bond downgrade, FINRA found that Popular Securities’ customers continued to purchase concentrated positions of the Puerto Rico securities.