In the FINRA quarterly enforcement update I found this little tidbit. There is no bottom to the depths of zero integrity and lack of conscience among financial professionals who are placed in position of fiscal responsibility for the oversight of your economic well-being. It is this very behavior that makes the Advocacy Network so important for your financial protection.
Writing Fictitious Non-Variable Life Insurance Policies 0 FINRA settled a matter involving a registered representative who wrote fictitious nonvariable life insurance policies. Between August 2013 and July 2015, the representative wrote 43 fictitious non-variable life insurance policies for clients who did not exist in order to meet production goals with the firm’s affiliated insurance company. The representative fabricated customer information on the policy applications and listed himself as the policy owner, payer and grandfather to the insured for each of the 43 policies. He paid the first premium for each of the 43 policies by personal check and received commission payments for each policy. After cancelling all 43 policies, which had not already lapsed, the insurance company refunded the premium payments to the representative less the commissions that he had been paid. The representative’s conduct violated FINRA Rule 2010 (ethical standards). For this misconduct, FINRA barred the representative from associating with any firm in any capacity.
Here is another sample of the lack of integrity and ethics among financial professionals.
Converting Customer Funds 0 FINRA settled a matter involving a registered representative who converted a customer’s funds. In July 2014, the representative convinced an elderly customer to pay him $100,000. The representative told the 85-year-old customer that he would use the funds to establish an independent investment advisory firm through which he would repay the $100,000 debt by providing the customer with free investment advice over the next four years. The representative never established an independent investment advisory firm. Indeed, when the representative and customer executed the loan agreement for the funds, the representative was planning on retiring from the securities industry. Shortly after obtaining the $100,000 from the customer, the representative sold his securities business to another registered representative and left the securities industry. As part of the sale, the representative entered into a non-compete agreement that prevented him from providing investment advice to his former customers, including the customer from whom he had obtained the $100,000. The representative used the customer’s $100,000 for his own personal use, including to pay off his daughter’s student loan debt and his own credit card bills. He also used some of the funds to engage in securities trading on his own behalf. The representative has not repaid any of the funds obtained from the customer. The representative’s conduct violated FINRA Rules 2150(a) (improper use of customers’ funds) and 2010 (ethical standards). For this misconduct, FINRA barred the representative from associating with any firm in any capacity.
To find more examples you can review the quarterly FINRA disciplinary report here
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