[ by Howard Haykin ]

FINRA banished a Florida broker from the industry for essentially playing a modern variation on the Robin Hood role - by stealing from the rich and giving to the poor promoter for an Alabama to casino project and other private investment groups.  After recommending and convincing one customer - an NFLer - to put most of his liquid assets into illiquid, high-risk securities issued in connection with a now-bankrupt casino, the broker convinced 30 other NFLers to do the same.  

Profile of Respondent.   Jeffrey Rubin of Lighthouse Point, FL, first became registered with FINRA in September 1997, as an Investment Company and Variable Products Rep.  In 2000, he obtained his Series 7 (General Securities Rep) license.  From 7/17/06 through 9/24/09, he was associated with Alterna Capital Corporation, and from 9/25/09 through 3/10/11 he was registered with International Assets Advisory, LLC.  Rubin currently is not associated
with a member firm.

FINRA Findings and Allegations.   In this case, Rubin allegedly committed 3 types of violations - (i) made unsuitable recommendations:  (ii) sold private securities without providing prior written notice to, or obtaining prior written approval from, his employer;  and, (iii) failed to disclose federal tax liens on Forms U4 filed with two employer member firms. 

From  2000 through 2009, Rubin operated a Florida-based company, Pro Sports Financial, which provided financial-related "concierge" services to professional athletes for an annual fee of approximately $40,000.  Rubin also sold securities and insurance products to his PSF clients - which he did as a broker with FINRA broker-dealers. 

One such customer, referred to as "Player One,"  opened a brokerage account with Rubin in 2002.  He did so shortly after signing a multi-million dollar contract with an NFL team.  On Player One's new account form, Rubin listed his investment objective as "Growth" with a "Moderate" risk tolerance.  Player One communicated to Rubin that his primary investment goal was to have sufficient funds so that he would not have to work upon retirement.

Between March 2006 and June 2008, while serving as a broker at Lincoln Financial Advisors Corporation and Alterna Capital Corporation, Rubin recommended that Player One invest a total of $3.5 million, the majority of his liquid net worth, in 4 high-risk, illiquid securities.  The largest investment was for $2 million, and it was for an  Alabama casino project.  The customer ultimately lost about $3 million.  

Rubin convinced another 30 or so additional customers, all professional football players, to invest in the casino project - some did so through Rubin, others directly with the promoter.  They invested and ultimately lost about $40 million in this project.  In return for his sales efforts and referrals, and other work for the project, Rubin was given a 4% ownership stake in the project and at least $500,000.  

FINRA EVP and Chief of Enforcement, Brad Bennett, issued this statement:   "This case demonstrates how broker misconduct can target high-income, inexperienced, and vulnerable investors. Jeffrey Rubin took advantage of professional athletes who placed their trust in him."

Violations Charged and Disciplinary Action.   The actions Rubin is alleged to have taken would violate NASD Conduct Rules 2110 (for conduct before 12/15/08), 2310,, and 3040, IM-1000-1 (for conduct before 8/17/09) and IM-2310-2, and FINRA Rules 1122 (for conduct after 8/16/09), and 2010 (for conduct after 12/14/08).   Rubin agreed to settle FINRA charges by accepting banishment from the industry.  

FINRA's investigation was conducted by the Departments of Enforcement and Member Regulation.

For further details, go to:   [FINRA News Release, 3/7/13] and [FINRA AWC # 2011026555901].