Former securities representative suspended and fined for allegedly engaging in an outside business activity without notice or approval
FINRA Rule 2010
FINRA Rule 3270
Securities representative suspended and fined for alleged Reg BI violations
The representative recommended a series of trades to a customer that were excessive, unsuitable and not in their best interest. The trades generated $25,939 in commissions and caused $24,568 in realized losses.
A partial restitutionary payment of $6,000 has also been ordered.
FINRA Rule 2010
FINRA Rule 2111
SEC Reg BI
SEA 1934 Rule 15l-1
Associated persons suspended until they comply with an arbitration award against them or establish a recognized defense
The associated persons have appealed a judgment confirming the arbitration award and were challenging FINRA’s right to suspend them while this appeal was pending.
The hearing officer concluded that, under existing law and precedent, FINRA could act now. And also held that an argument that a suspension was not possible while an appeal against an arbitration award was pending was one that “cuts against” a “fundamental and distinctive aspect of arbitration.”
This is an OHO decision and not an AWC.
FINRA Rule 0140
FINRA Rule 9559
FINRA By-Laws Article VI Section 3
Securities Principal suspended and fined for alleged Reg BI violations
The principal made recommendations to three retail customers and six non-retail customers without having a sufficient understanding of the features and risks associated with the exchange-traded note in question.
The recommendations to the retail customers were also inconsistent with their investment profiles, including their moderate risk tolerances and their lack of previous investment experience.
FINRA Rule 2010
FINRA Rule 2111
SEC Reg BI
SEA 1934 Rule 15l-1
Former securities representative barred for allegedly participating in private securities transactions without notice or approval
FINRA Rule 2010
FINRA Rule 3280
Former products representative suspended and fined for allegedly making misrepresentations to a mortgage lender
Two letters were submitted to help a friend qualify for and obtain a mortgage loan. The letters mispresented the funds transferred to the friend as bona fide gifts as well as the relationship between the representative and the friend.
FINRA Rule 2010
Securities representative suspended and fined for alleged Reg BI violations
The representative excessively traded the accounts of two retail customers. The trading resulted in high turnover rates and cost-to-equity ratios and resulted in significant realized losses.
The trading was unsuitable for one of the customers and not in the best interest of the other.
A restitutionary payment of $60,975 plus interest has been ordered.
FINRA Rule 2010
FINRA Rule 2111
SEC Reg BI
SEA 1934 Rule 15l-1
Webull Financial censured and fined for alleged compliance failings related to social media communications as well as other violations
From January 2019 through December 2022 an affiliated marketing company paid more than 400 individuals to promote the firm and its services on social media platforms and electronic forums.
Some of these posts were not fair or balanced and may also have been promissory or exaggerated, while the communications were promissory, unwarranted or failed to disclose the risks associated with the trading.
The firm failed to review or approve these the posts and communications and also failed to preserve and retain them as required by FINRA and SEC rules.
In addition the firm also failed to establish and maintain a supervisory system reasonably designed to preserve records related to communications by influencers including:
- copies of the communications;
- dates of use;
- names of registered principals approving the communications; and
- dates of approval.
The required Form CRS was not delivered by the firm to approximately 5.9 million customers. Although the form was published on the firm’s website, the firm did not have in place a system that would facilitate its distribution and the recording of its delivery to customers.
In addition the firm failed to:
- provide a consolidated display that complied with the Vendor Display Rule;
- reasonably supervise for compliance with this rule;
- establish and maintain adequate financial risk management controls and procedures in order to prevent the entry of erroneous orders;
- review and approve some retail communications posted by its registered representatives; and
- preserve records of these communications.
FINRA Form CRS
FINRA Rule 2010
FINRA Rule 2210
FINRA Rule 3110
FINRA Rule 4511
FINRA Reg Notice 10-06
FINRA Reg Notice 15-52
FINRA Reg Notice 17-18
Regulation NMS Rule 603
SEA 1934 Rule 15c3-5
SEA 1934 Rule 17a-3
SEA 1934 Rule 17a-4
SEA 1934 Rule 17a-14
Securities representative suspended and fined for alleged Reg BI violations
The representative excessively traded the accounts of two retail customers. The trading resulted in high turnover rates and cost-to-equity ratios and resulted in significant realized losses.
A partial restitutionary payment of $55,770 plus interest has also been ordered.
FINRA Rule 2010 FINRA Rule 2111 SEC Reg BI SEA 1934 Rule 15l-1
| Unless otherwise noted all respondents accepted and consented to FINRA’s findings without admitting or denying them. |
