A Registered Principal (Morristown, NJ), while supervising his firm's securities lending desk, allegedly permitted a non-registered individual - associated with a non-registered finder firm - to act in a capacity that required that individual and/or his firm to be registered as a broker-dealer, and causing the firm to pay the individual transaction-based compensation through the finder firm.

    Kevin Garvey, with Raymond James since 1995, held Series 7 and 24 licenses, and was registered with the Amex, CBOE, Nasdaq, Nasdaq-Phlx, NYSE, and, FINRA.  However, he's alleged to have served as his firm's securities lending supervisor without being properly registered - in violation of FINRA Incorp'd NYSE Rules 345(A)(IV) - although he was approved with the NYSE as a securities lending supervisor on 2/4/2005.  [C-I Note: Unfortunately, we don't know the dates of his alleged violations.].

Garvey allegedly permitted an unregistered natural person to negotiate, solicit and enter into stock borrow and loan transactions, when those duties are typically handled by a registered securities lending representative. 

Garvey allegedly consented to and/or caused the payment of finders fees in cses where the finder had provided no service (the cut-in transactions).  Garvey allegedly permitted individual traders to subjectively determine the cut-in transactions on which a finder was to be paid and the amount of the finder’s fees in those transactions even though the finder had provided no service on the transactions.

Garvey allegedly caused his firm to have inaccurate books and records - firm’s automated records of the cut-in transactions were transferred to its accounting records with inaccurate indication that payments were being made for services rendered.   (FINRA Case #2009018183501 - FINRA Disciplinary Actions for November]