Articles Posted in FINRA Disciplinary Actions

(FINRA Case #2016048942501)

 Heather Xanthe VanLandingham (CRD #5343446, Odessa, Florida) – An AWC (Accept, Waiver & Consent) was issued in which VanLandingham was fined $5,000 and suspended from association with any FINRA member in all capacities for 20 business days.

Without admitting or denying the findings, VanLandingham consented to the sanctions and to the entry of findings that she effected transactions in a customer’s account at her member firm without the customer’s knowledge or authorization.

(FINRA Case #2017056130301)

Andrew Jay Lowe (CRD #4636118, Leesburg, Alabama) – An AWC (Accept, Waiver, & Consent) was issued in which Lowe was assessed a deferred fine of $20,000, suspended from association with any FINRA member in all capacities for nine months and ordered to pay $36,180.87, plus interest, in deferred disgorgement of commissions received.

Without admitting or denying the findings, Lowe consented to the sanctions and to the entry of findings that he recommended and engaged in unsuitable trading of Class A mutual fund shares. The findings stated that Lowe’s recommendations caused the customers to incur unnecessary sales charges, and were unsuitable in view of the short holding periods and cost of the transactions. At the time Lowe recommended Class A shares, he knew that these customers had short-term income needs and would need to make complete or partial liquidations of their investments within a year to meet those needs. Nevertheless, Lowe recommended that these customers purchase the A shares because of his belief that, in the long term, the A share investments provided a better value to the customers. Subsequently, over a two-year period, Lowe effected total or partial liquidations of the A shares, over half of which were held for less than 12 months, to meet his clients’ income needs.

(FINRA Case #2012034389202)

Bernard G. McGee (CRD #1203327, Cazenovia, New York) – A United States Court of Appeals for the Second Circuit Summary Order became final in which McGee was barred from association with any FINRA member in all capacities and ordered to pay $237,643.25, plus interest, in restitution to a customer.

The U.S Court of Appeals for the Second Circuit denied McGee’s petition for review following appeal of an SEC decision.

(FINRA Case #2018059559101)

Daniel Noah Winger (CRD #1542674, Bonney Lake, Washington) – An AWC (Accept, Waiver & Consent) was issued in which Winger was barred from association with any FINRA member in all capacities.

Without admitting or denying the findings, Winger consented to the sanction and to the entry of findings that he converted the funds of an elderly customer of his member firm for his own personal use.

FINRA Case #2014042022401)

Brian Lawrence Stephan (CRD #4222796, Jamestown, Ohio) – Stephan was named a respondent in a FINRA complaint alleging that he recommended and caused the execution of unsuitable investments for an 88-yearold customer.

The complaint alleges that Stephan recommended that the elderly customer invest in mutual fund Class A shares in 20 different mutual fund families. This recommendation was unsuitable because the customer would have been able to achieve a discount on applicable sales charges by aggregating her mutual fund purchases into fewer fund families.

FINRA Case #2014041590801)

John William Cutshall (CRD #874352, Woodsboro, Maryland) – Cutshall was named a respondent in a FINRA complaint alleging that he abused his position as trustee for trusts that he administered on behalf of a married deceased couple and an elderly widow, by converting and improperly using funds from these trusts.

The complaint alleges that in total, Cutshall took approximately $400,000 from the account of the deceased customers’ residuary trust by using his position as trustee to write checks drawn against the trust’s account at his member firm and depositing the checks into his personal bank account. Cutshall did not disclose to his firm that he took these funds.

(FINRA Case #2016049321301)

Terry Lee McCoy (CRD #1476696, New Port Richey, Florida) – An AWC (Accept, Waiver, & Consent) was issued in which McCoy was assessed a deferred fine of $75,000 and barred from association with any FINRA member in any principal capacity.

Without admitting or denying the findings, McCoy consented to the sanctions and to the entry of findings that he failed to appropriately supervise the sales practices of his member firm’s registered representatives.

(FINRA Case #2016050474001)

Donald Lane Preston (CRD #4704220, Powell, Ohio) – An AWC (Accept, Waiver & Consent) was issued in which Preston was assessed a deferred fine of $10,000, suspended from association with any FINRA member in all capacities for six months, ordered to pay $3,515.51, plus interest, in deferred restitution of fees to a customer and ordered to pay $1,427.39, plus interest, in deferred disgorgement of commissions received.

Without admitting or denying the findings, Preston consented to the sanctions and to the entry of findings that he recommended variable annuity exchanges and a mutual fund investment to a customer without having a reasonable basis to believe that the proposed investments were suitable.

(FINRA Case #2016051493702)

Harold Lee Connell (CRD #1482623, Pinecrest, Florida) – An AWC (Accept, Waiver, and Consent) was issued in which Connell was barred from association with any FINRA member in all capacities. Without admitting or denying the findings, Connell consented to the sanction and to the entry of findings that he willfully violated Section 10(b) of the Exchange Act and Rule 10b-5, and FINRA Rules 2010 and 2020 by participating in the sale of three unregistered Regulation D offerings through misrepresentations and omissions.

The findings stated that Connell and others at his member firm raised over $4.5 million from individual investors in connection with the sale of the three unregistered Regulation D offerings. The private placement memorandums (PPMs) for the three offerings provided that investors’ funds would be used to make investments in a variety of companies. However, the first offering was invested 85 percent in one penny stock company. The other two offerings were primarily undisclosed self-offerings.

(FINRA Case #2015046971701)

 Nas Adel Allan (CRD #4562149, Staten Island, New York) – An Offer of Settlement was issued in which Allan was fined $2,500, suspended from association with any FINRA member in all capacities for one month and ordered to pay disgorgement of a portion of commissions received in the amount of $2,500, plus interest.

Without admitting or denying the allegations, Allan consented to the sanctions and to the entry of findings that he recommended, over an approximate two month period, that elderly husband and wife customers engage in short-term trading of a single security that they had held for over 36 years, resulting in losses and capital gains tax liability for the customers and generating over $22,000 in commissions, markups and markdowns for Allan.