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Stories of Interest
- Sarah ten Siethoff is New Associate Director of SEC Investment Management Rulemaking Office
- Catherine Keating Appointed CEO of BNY Mellon Wealth Management
- Credit Suisse to Pay $47Mn to Resolve DOJ Asia Probe
- SEC Chair Clayton Goes 'Hat in Hand' Before Congress on 2019 Budget Request
- SEC's Opening Remarks to the Elder Justice Coordinating Council
- Massachusetts Jury Convicts CA Attorney of Securities Fraud
- Deutsche Bank Says 3 Senior Investment Bankers to Leave Firm
- World’s Biggest Hedge Fund Reportedly ‘Bearish On Financial Assets’
- SEC Fines Constant Contact, Popular Email Marketer, for Overstating Subscriber Numbers
- SocGen Agrees to Pay $1.3 Billion to End Libya, Libor Probes
- Cryptocurrency Exchange Bitfinex Briefly Halts Trading After Cyber Attack
- SEC Names Valerie Szczepanik Senior Advisor for Digital Assets and Innovation
- SEC Modernizes Delivery of Fund Reports, Seeks Public Feedback on Improving Fund Disclosure
- NYSE Says SEC Plan to Limit Exchange Rebates Would Hurt Investors
- Deutsche Bank faces another challenge with Fed stress test
- Former JPMorgan Broker Files racial discrimination suit against company
- $3.3Mn Winning Bid for Lunch with Warren Buffett
- Julie Erhardt is SEC's New Acting Chief Risk Officer
- Chyhe Becker is SEC's New Acting Chief Economist, Acting Director of Economic and Risk Analysis Division
- Getting a Handle on Virtual Currencies - FINRA
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NEWSLETTERS & ALERTS
Beg, Borrow and Steal(?)
by Howard Haykin
PRUCO SECURITIES BROKER. In November 2016, the broker borrowed $5,000 from an elderly customer. The loan has not been repaid. Pruco learned about the loan and, in September 2017, discharged the broker for taking loans and accepting money from multiple clients without firm approval. Upon receiving Pruco’s Form U5, FINRA initiated an investigation that concluded in March 2019 with the broker agreeing to pay a $5K fine and serve a 3-month suspension to settle charges that he violated FINRA Rule 3240(a). [FINRA Case #2017056094402]
MORGAN STANLEY BROKER. In August 2016, while experiencing financial difficulties, the broker borrowed $30,000 from a longtime friend and MS customer. Funds for the loan were wired from the customer's brokerage account to an external bank account also belonging to the customer. The customer then wired the funds to the broker. To conceal the purpose of the customer's withdrawal from Morgan Stanley, the broker submitted a wire transfer form that inaccurately described the reason for the wire transfer as for a "Car Purchase."
In December 2016, the customer agreed to loan the broker additional funds, and another wire transfer form was submitted to the firm – this time with “Living Expenses” as the reason for the withdrawal. After the funds were wired the customer elected not to consummate the 2nd loan. At or around this time, Morgan Stanley learned about the initial $30,000 loan, whereupon it terminated the broker and reimbursed the customer.
FINRA initiated an investigation that concluded in March 2019 with the broker agreeing to serve a 4-month suspension to settle charges that she violated FINRA Rule 3240(a). No fine was issued in light of the broker’s financial status. [FINRA Case #2017052985001]
These cases were reported in FINRA Disciplinary Actions for May 2019.