FINRA Broker Disciplinary Action Report: May 2020
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
Louis Cook (CRD #2469412, Staten Island, New York)
Without admitting or denying the findings, Cook consented to the sanction and to the entry of findings that he made intentional misrepresentations to customers of his member firm that induced them to sign third-party authorization forms. The findings stated that the third-party authorization forms permitted the customers to designate Cook to make changes and/or withdraw funds from the policy value of their variable annuity to pay advisory fees. Many of these customers were elderly investors or the parents of developmentally disabled children who Cook had met through his approved outside business activity. Cook made a number of intentional misrepresentations in a cover letter that was accompanied by the third-party authorization form. The misrepresentations included that the third-party authorization forms were needed for him to continue to service the customers’ variable annuity policies and that the forms were triggered by the Department of Labor’s fiduciary rule. The findings also stated that Cook improperly used funds from the customers’ variable annuities for his own personal use. Relying upon Cook’s misrepresentations, the customers signed the third-party authorization forms, which Cook subsequently used to withdraw more than $150,000 from the customer’s variable annuity accounts. The customers did not intend to authorize Cook to withdraw funds from their variable annuities for his own personal use.
Andre Pierre Davis (CRD #1417097, Freehold, New Jersey)
Without admitting or denying the findings, Davis consented to the sanction and to the entry of findings that he refused to produce information or documents requested by FINRA in connection with an investigation into allegations that he engaged in excessive and unsuitable trading in customer accounts while associated with his member firm.
Daniel Joseph Arcuri Jr. (CRD #2200431, Greensburg, Pennsylvania)
An Office of Hearing Officers (OHO) decision became final in which Arcuri was barred from association with any FINRA member in all capacities. The sanction was based on the findings that Arcuri failed to appear for and provide on-the-record testimony requested by FINRA during its investigation into his outside business activities and potential misuse of customer funds. The findings stated that Arcuri’s member firm filed a Uniform Termination Notice for Securities Industry Registration (Form U5) disclosing that it had terminated Arcuri for failing to seek and obtain its approval to engage in an outside business activity as the representative of the estate of a deceased client.
Dana Bruce Vietor (CRD #873129, Dallas, Texas)
Without admitting or denying the findings, Vietor consented to the sanction and to the entry of findings that he engaged in the sale of promissory notes with customers totaling more than $3 million without disclosing and receiving approval from his member firms for each individual private securities transaction. The findings stated that Vietor, along with other business partners, was engaged in a start-up business venture that required funding. Initially, the business venture raised funds by way of private placement offerings. Vietor disclosed to the firms his participation in the private placements, as well as his participation in the business venture. However, later the business venture raised funds for entities associated with it by selling the undisclosed promissory notes. Vietor is a member of the management team that manages these entities and has membership interests in each. Therefore, Vietor received indirect selling compensation.
Steven Dale Rodemer (CRD #830561, Colorado Springs, Colorado)
Without admitting or denying the findings, Rodemer consented to the sanction and to the entry of findings that he refused to provide on-therecord testimony requested by FINRA during its investigation into the conduct disclosed in a Form U5 submitted by his member firm. The findings stated that the firm submitted the Form U5 terminating Rodemer for taking money from a client account for his personal use without authorization.
James Andrew Gallego (CRD #6226068, Austin, Texas) March 27, 2020
Without admitting or denying the findings, Gallego consented to the sanction and to the entry of findings that he refused to provide documents and information requested by FINRA in connection with its investigation into his potential involvement in the movement of funds belonging to a senior customer at his member firm.
Gerald Roger Dewes (CRD #2465538, East Amherst, New York)
Without admitting or denying the findings, Dewes consented to the sanction and to the entry of findings that he refused to appear for on-therecord testimony requested by FINRA in connection with an investigation into his potential participation in undisclosed private securities transactions and outside business activities.
For the full FINRA Disciplinary Report, please click here.
