(FINRA Case #2015046728802)
Jay Dee Jordan (CRD #1776666, Oklahoma City, Oklahoma) – An AWC (Accept, Waiver & Consent) was issued in which Jordan was barred from association with any FINRA member in all capacities.
Without admitting or denying the findings, Jordan consented to the sanction and to the entry of findings that he recommended and executed hundreds of unsuitable purchases of non-traditional ETFs in his customers’ accounts.
The findings stated that Jordan failed to use reasonable diligence to obtain an adequate knowledge base regarding these highly sophisticated products before recommending them to his customers.
As a result, Jordan failed to understand the extraordinary risks associated with nontraditional ETFs, the features of such investments, and the compounding of risks associate with holding non-traditional ETFs. In total, Jordan recommended that his clients purchase more than $22 million in non-traditional ETFs. Jordan routinely failed to sell these products on the same day he purchased them, and he failed to conduct a daily analysis to ascertain whether it was appropriate to hold the products for an extended period of time. Because Jordan failed to do reasonable diligence to understand the attributes and risks of non-traditional ETFs, he did not have a reasonable basis to believe that the recommendations, to purchase the non-traditional ETFs, were suitable for any investor. Jordan did not have a reasonable basis to believe that his long-term buy and-hold recommendations were suitable. Jordan failed to conduct a customer-specific suitability analysis for many of the customers for whom he either made recommendations or exercised discretion to purchase nontraditional ETFs.
Ultimately, Jordan’s unsuitable recommendations in non-traditional ETFs in the clients’ accounts resulted in realized and unrealized customer losses exceeding $8.4 million for positions held longer than 30 days, while Jordan and the firm received gross commissions of approximately $810,000 from non-traditional ETF transactions.
The findings also stated that Jordan exercised discretion to purchase non-traditional ETFs in customers’ accounts without first obtaining written authorization from these customers and the firm’s approval to effect any discretionary trades in any of these accounts.
Moreover, Jordan provided false answers on his firm’s annual compliance questionnaires regarding his use of discretion and falsely responded to an email inquiry from his supervisor about the use of discretion. The findings also included that Jordan solicited customer purchases of non-traditional ETFs and mis-marked most of these purchases as unsolicited.
FINRA found that Jordan failed to report two customer complaints to his firm, and then attempted to settle one of the claims away from the firm through the improper use of his personal email account.
FINRA also found that Jordan failed to produce documents and information to FINRA pertaining to outside investments that he may have made with a customer.
Jordan was discharged from WFG Investments, Inc. in March of 2016, which he had been employed at since September 2005, due to allegations. He currently has 10 pending customer complaints registered at FINRA.
If you feel you have been misled by a Jay Jordan or Brokerage Firm and wish to discuss legal action, please contact Darren Blum at 1-877-786-2552 (1-877-STOCK LAW), www.stockattorneys.com for a free consultation.