FINRA Broker Disciplinary Action Report: April 2019
Each month, the agency that regulates the financial industry, FINRA (Financial Industry Regulatory Authority), produces a detailed report that runs down all disciplinary actions recently taken against brokerage firms and brokers. We strongly encourage any investor who suspects their broker and/or broker-dealer of having lost them money on dubious terms to at least skim this report to see if you recognize any names, schemes, products, or securities.
For our part, we like to pick out some of the highlights from each report. Specifically, we’re looking for schemes or abuses that might be more far-reaching than the individual cases brought through the FINRA arbitration process.
Brokers & Brokerages Barred, Suspended, and/or Fined by FINRA
Bhenoy Dembla aka Ben Dembla (CRD #4357042, Miami Beach, Florida)
Without admitting or denying the findings, Dembla consented to the sanction and to the entry of findings that he entered, and later canceled, fictitious mutual fund sell orders to circumvent restrictions placed by his member firm and mutual fund providers on the amount of Class B shares an investor can own. The findings stated that these fictitious sell orders, and subsequent purchases of Class B shares, caused the accounts of customers to exceed the accumulation limit by a total of $863,000. The firm subsequently provided $31,801 in restitution to these customers. The findings also stated that Dembla caused the firm to maintain inaccurate books and records by making false entries on firm databases as to why the clients wanted to sell Class B shares.
Martin Kirschner (CRD #1326676, Staten Island, New York)
Without admitting or denying the findings, Kirschner consented to the sanction and to the entry of findings that he refused to appear for FINRA on-the-record testimony in connection with an investigation by FINRA into whether he failed to disclose a gift from a customer and failed to disclose his co-power-of-attorney appointment in violation of FINRA rules.
Floyd Earl Powell (CRD #2220029, Albertville, Alabama)
Without admitting or denying the findings, Powell consented to the sanction and to the entry of findings that he engaged in private securities transactions without providing notice to or obtaining approval from his member firms prior to participating in them. The findings stated that Powell solicited investors to purchase promissory notes relating to a purported real estate investment fund.
Michael John Rappa (CRD #4799159, Roseville, California)
Without admitting or denying the findings, Rappa consented to the sanction and to the entry of findings that he engaged in undisclosed and unapproved private securities transactions. The findings stated that Rappa solicited investors to purchase promissory notes relating to a purported real estate investment fund. Rappa sold $2,731,287 in in the fund’s notes to investors, some of whom were customers of his member firm, and received a total of $109,939 in commissions in connection with these transactions. Later the fund filed a voluntary Chapter 11 bankruptcy petition.
Salman Rasheed (CRD #6421984, Chicago, Illinois)
Without admitting or denying the findings, Rasheed consented to the sanction and to the entry of findings that he accepted $390,045 in checks as gifts from an elderly customer of his member firm. The findings stated that Rasheed never disclosed to the firm his receipt of these monetary gifts.
Thomas Cameron Oakes (CRD #1354152, Montague, Michigan)
Without admitting or denying the findings, Oakes consented to the sanction and to the entry of findings that he refused to appear for FINRA on-the-record testimony during the course of an investigation initiated by FINRA after it received several complaints by customers of his claiming that he had recommended unsuitable transactions.
Stephen Michael Hart (CRD #5021146, Hoboken, New Jersey)
Without admitting or denying the findings, Hart consented to the sanction and to the entry of findings that he failed to provide documents and information requested by FINRA in connection with its investigation into allegations that he converted money or property outside of his member firm.
For the full FINRA Disciplinary Report, please click here.
