FINRA Broker Disciplinary Action Report: June 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
Bradley Allen Latting (CRD #4850825, Jenks, Oklahoma)
Without admitting or denying the findings, Latting consented to the sanction and to the entry of findings that he refused to appear for and provide on-the-record testimony requested by FINRA in connection with its investigation into allegations that he commingled and/or converted funds belonging to an elderly client of his member firm’s affiliated banking and insurance entities, and failed to disclose his service as the client’s power-of-attorney.
Jim Jinkook Seol (CRD #2876279, Lake Forest, California)
A NAC decision became final in which Seol was barred from association with any FINRA member in all capacities. The NAC affirmed the findings and the sanctions imposed by the OHO. The sanction was based on the findings that Seol participated in private securities transactions and engaged in outside business activities without providing prior written notice to, or receiving written approval from, his member firm. The findings stated that Seol formed a corporation through which he solicited investments totaling $100 million from foreign customers in a limited partnership that he also formed to serve as a qualifying investment facility. In addition, through the corporation, Seol entered into a consulting agreement with an entity to assist it with the identification and solicitation of qualified foreign nationals to develop and operate yogurt shops in the United States.
Michael Paul Lessard Jr. (CRD #5968857, Rock Hill, South Carolina)
Without admitting or denying the findings, Lessard consented to the sanction and to the entry of findings that he borrowed a total of approximately $82,750 from two customers without notifying or seeking the approval of either of his member firms. The findings stated that Lessard borrowed $60,000 from a senior customer whom Lessard only completely repaid after the customer and her accountant confronted him. In addition, Lessard borrowed $22,750 from another customer whom he never repaid.
Thomas H. Laws (CRD #4494448, Silver City, New Mexico)
Without admitting or denying the findings, Laws consented to the sanction and to the entry of findings that he refused to appear for and provide on-the-record testimony requested by FINRA during the course of an investigation into whether he potentially violated FINRA rules by engaging in undisclosed outside business activities and/or private securities transactions while associated with a member firm.
John William Cutshall (CRD #874352, Woodsboro, Maryland)
Without admitting or denying the allegations, Cutshall consented to the sanction and to the entry of findings that he abused his position as trustee for trusts that he administered on behalf of deceased and elderly customers by converting and improperly using funds from these trusts. The findings stated that Cutshall served as trustee for the separate trusts of the customers, who were husband and wife, until both customers died.
James Bradley Schwartz (CRD #3043085, New York, New York)
Without admitting or denying the allegations, Schwartz consented to the sanction and to the entry of findings that he churned customer accounts in willful violation of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The findings stated that Schwartz also excessively traded customer accounts. Schwartz’s churning and excessive trading was unsuitable and caused combined losses of more than $660,000 in these accounts.
For the full FINRA Disciplinary Report, please click here.