FINRA Broker Disciplinary Action Report: July 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
Moloney Securities Co., Inc. (CRD #38535, Manchester, Missouri)
An AWC was issued in which the firm was censured, fined $100,000 and ordered to pay $15,574.13, plus interest, in restitution to a customer. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to establish and maintain a supervisory system, including WSPs, reasonably designed to achieve compliance with FINRA’s suitability rule with respect to qualitative suitability and concentration in high-risk products. The findings stated that the firm’s WSPs contained a cursory discussion of monitoring for qualitative suitability, including procedures related to speculative, low-priced securities and no discussion of concentration in high-risk products. Further, the firm did not provide any training to its regional managers on reviewing the suitability of recommendations in such products, nor did it issue any instructional materials or alerts, such as compliance bulletins, addressing these issues. The electronic surveillance system provided to and utilized by the firm was not equipped to reasonably surveil for concentration in high-risk products or qualitative suitability…
SunTrust Investment Services, Inc. (CRD #17499, Atlanta, Georgia)
An AWC was issued in which the firm was censured, fined $50,000 and ordered to pay $584,466.13 in restitution to customers. The firm has already voluntarily paid full restitution to these customers. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to establish, maintain and enforce a supervisory system or WSPs reasonably designed to achieve compliance with FINRA’s suitability rule as it relates to non-traditional exchange traded funds (NT-ETFs), particularly in connection with certain of the unique features and risks associated with these funds, including the risks associated with holding them for extended periods.
Thomas Maroun Hakim (CRD #1170096, Clinton Township, Michigan)
An AWC was issued in which Hakim was barred from association with any FINRA member in all capacities. Without admitting or denying the findings, Hakim consented to the sanction and to the entry of findings that he failed to provide information and documents requested by FINRA in connection with its investigation into his failure to disclose, or timely disclose, unsatisfied liens and judgments on his Form U4. The findings stated that Hakim provided partial responses to FINRA but did not substantially comply with all aspects of the request.
Bryce Patrick Jenney (CRD #6207379, Nashville, Tennessee)
An Office of Hearing Officers (OHO) decision became final in which Jenney was barred from association with any FINRA member in all capacities. The sanction was based on findings that Jenney failed to produce documents and to appear and provide onthe-record testimony requested by FINRA during its investigation into the circumstances that led to his termination from his member firm. The findings stated that the firm submitted a Uniform Termination Notice for Securities Industry Registration (Form U5) terminating Jenney’s employment and disclosing that he provided investment advice on a securities product not offered by the firm.
Arthur Stewart Hoffman (CRD #3193754, Peoria, Arizona)
AWC was issued in which Hoffman was barred from association with any FINRA member in all capacities. Without admitting or denying the findings, Hoffman consented to the sanction and to the entry of findings that he failed to provide documents and information requested by FINRA in connection with an investigation opened in response to a disclosure filed by his member firm that stated that he had been suspended for company policy violations related to outside business activities and private securities transactions.
Irene Padrick Engard (CRD #2300387, Costa Mesa, California)
An AWC was issued in which Engard was barred from association with any FINRA member in all capacities. Without admitting or denying the findings, Engard consented to the sanction and to the entry of findings that she refused to produce documents and information requested by FINRA in connection with its investigation of her outside business activity.
Timothy Bernard Cooney (CRD #2946727, Chatham, Massachusetts)
An AWC was issued in which Cooney was barred from association with any FINRA member in all capacities. Without admitting or denying the findings, Cooney consented to the sanction and to the entry of findings that he failed to produce documents and information requested by FINRA. The findings stated that Cooney’s member firm
For the full FINRA Disciplinary Report, please click here.
