Articles Posted in FINRA Disciplinary Actions

(FINRA Case #2016051146801)

Adriane L. Cagle (CRD #6236929, Fayetteville, Georgia) submitted an AWC (Accept, Waiver & Consent) in which she was assessed a deferred fine of $5,000 and suspended from association with any FINRA member in all capacities for two months. Without admitting or denying the findings, Cagle consented to the sanctions and to the entry of findings that she altered several documents that had already been signed by customers and signed as a witness to customer signatures on certain documents without having actually witnessed the customers sign them.

The findings stated that approximately two years after receiving a written disciplinary letter from her member firm for altering certain documents after they had already been signed by a customer, Cagle engaged in similar practices in an effort to avoid inconvenience.

(FINRA Case #2015044123501)

Scott Allen Sibley (CRD #1523981, Fort Lauderdale, Florida) submitted an AWC (Accept, Waiver & Consent) in which he was barred from association with any FINRA member in all capacities. Without admitting or denying the findings, Sibley consented to the sanction and to the entry of findings that he effected about 900 securities purchases and sales in a customer’s two accounts without the customer’s authorization, knowledge or consent.

The findings stated that of the 900 securities purchases and sales, 139 were equity options where Sibley sold uncovered put option contracts or closed put option contracts for the customer. In addition to effecting purchases and sales without written authorization, Sibley caused the customer to carry a margin debit balance without the customer’s authorization, knowledge or consent. The customer never authorized Sibley to purchase securities in his account that would result in a debit balance.

(FINRA Case #2012034037602)

FSC Securities Corporation (CRD #7461, Atlanta, Georgia) submitted an AWC (Accept, Waiver & Consent) in which the firm was censured and fined $200,000. 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 that was reasonably designed to review and monitor third-party check requests from customer accounts.

The findings stated that a registered representative associated with the firm sold memberships in an investment fund created by a former firm representative. Without the firm’s knowledge or approval, the representative sold memberships in the fund, which was not an approved product for sale, and the firm did not therefore supervise the representative’s sales. In connection with the representative’s sale of the fund memberships, the representative submitted to the firm Letters of Authorization (LOA) signed by each of the 15 firm customers, which authorized in aggregate approximately $1.6 million to be transferred from their firm brokerage accounts to a bank account the fund controlled.

(FINRA Case #2016051002701)

Angelina Ozlem Todurge (CRD #4678713, West Palm Beach, Florida) submitted an AWC (Accept, Waiver & Consent) in which she was barred from association with any FINRA member in all capacities. Without admitting or denying the findings, Todurge consented to the sanction and to the entry of findings that she failed to provide FINRA with documents and information concerning allegations that she converted $13,000 for her personal use.

Todurge was discharged from J.P. Morgan Chase Bank in September 2016 after allegations she failed to report the receipt of funds from a third party bank which were errantly wired to a registered representative’s Chase Bank account and then used the funds for personal use.  She had worked for J.P. Morgan Securities LLC in Palm Beach Florida since December 2014.

(FINRA Case #2012033767402)

Enrique Mercado Jr. (CRD #2242873, Miami, Florida) submitted an Offer of Settlement in which he was assessed a deferred fine of $15,000 and suspended from association with any FINRA member in all capacities for 12 months.

Without admitting or denying the allegations, Mercado consented to the sanctions and to the entry of findings that he submitted a false and backdated FINRA Rule 3130 certification to FINRA in response to a FINRA Rule 8210 request.

(FINRA Case #2016050259801)

Legend Equities Corporation (CRD #30999, Palm Beach Gardens, Florida) submitted an AWC (Accept Waiver & Consent) in which the firm was censured and required to provide FINRA with a plan to remediate eligible customers who qualified for, but did not receive, the applicable mutual fund sales-charge waiver.

As part of this settlement, the firm agrees to pay restitution to eligible customers, which is estimated to total $2,300,188 (the amount eligible customers were overcharged, inclusive of interest). The firm will also ensure that retirement and charitable waivers are appropriately applied to all future transactions.

The suspension is in effect from March 20, 2017, through May 19, 2017. (FINRA Case #2015044792802)

Diego Jimenez (CRD #4557717, Arlington, Texas) submitted an AWC(Accept, Waiver & Consent) in which he was assessed a deferred fine of $5,000 and suspended from association with any FINRA member in any capacity for two months. Without admitting or denying the findings, Jimenez consented to the sanctions and to the entry of findings that he engaged in securities activities without being registered with FINRA.

The findings stated that Jimenez voluntarily terminated his registration with a member firm but remained associated with the firm and participated in various securities activities that supported his father’s securities business at the firm. As part of this work, while he was not registered, Jimenez solicited prospective mutual fund customers, made mutual fund presentations, discussed mutual fund investments with prospective customers, and recommended the purchase of mutual funds resulting in total sales of more than $800,000 in 35 mutual fund accounts. Jimenez also assisted customers with the completion of documents necessary to purchase mutual funds and entered customer and trade information electronically into the firm’s computer system. These activities required registration.

The suspension is in effect from March 6, 2017, through June 5, 2017. (FINRA Case #2016049938201)

Harold Stephen Pomeranz (CRD #365461, Plainview, New York) submitted an AWC (Accept, Waiver & Consent) in which he was assessed a deferred fine of $5,000 and suspended from association with
any FINRA member in any capacity for three months.

Without admitting or denying 
the findings, Pomeranz consented to the sanctions and to the entry of findings that he recommended a number of unsuitable short-term unit investment trust (UIT) transactions in an elderly customer’s account. The findings stated that the UITs Pomeranz recommended to the customer had maturity dates of 24 months, and carried initial sales charges ranging from approximately 2.5 percent to 3.95 percent. Yet the average holding period for the UITs Pomeranz recommended was less than 14 months.

(FINRA Case #2014039169601)

Berthel, Fisher & Company Financial Services, Inc. (CRD #13609, Cedar Rapids, Iowa)and Jeffrey Paul Dragon (CRD #1874038, Swampscott, Massachusetts) were named respondents in a FINRA complaint alleging that Dragon generated more than $421,000 in concessions for himself and the firm, at the expense of his customers, by recommending and effecting a pattern of unsuitable short-term trading of UITs (Unit Investments Trusts).

The complaint alleges that the firm is liable for Dragon’s unsuitable investment recommendations under the doctrine of respondeat superior because he was an agent of the firm acting within the scope of his duties when he engaged in this misconduct.  The short-term trading patterns were inconsistent with the design of the securities at issue and required the customers to pay substantial sales charges, most of which came back to the firm and the representative in the form of dealer concessions.

(FINRA Case #2016050071102)

Derek Wayne Border (CRD #5175361, Huntington, Pennsylvania) submitted an AWC (Accept, Waiver and Consent) in which he was fined $5,000 and suspended from association with any FINRA member in any capacity for three months. Without admitting or denying the findings, Border consented to the sanctions and to the entry of findings that he altered or caused to be altered customer documents, including account distribution forms, by copying and pasting customer signatures and/or altering dates and other information. The findings stated that the customers verbally authorized the underlying transactions.

At the time of the allegations Border worked form Sorrento Pacific Financial LLC and was discharged in August 2016.  Border is currently employed by Packerland Brokerage Services, Inc.