Subscribe to our mailing list

* indicates required







We seek to provide information, insights and direction that may enable the Financial Community to effectively and efficiently operate in a regulatory risk-free environment by curating content from all over the web.


Stay Informed with the latest fanancialish news.




Regulatory Sanctions

FINRA Sends Message to Broker Caught in, Yet, Another Cover-Up

March 27, 2018

by Howard Haykin


A broker with Ameriprise Financial Services agreed to pay a $7.5K fine and serve a 5-month suspension to settle FINRA charges that she: (i) borrowed money from a securities customer, her friend, without informing her member firm; and, (ii) texted that same customer about securities without providing copies to her member firm.


FINRA FINDINGS.    The broker, an 18-year veteran with 3 firms, had been disciplined by FINRA once before – in 2014 - for using discretion without prior written approval on five dozen occasions, and for mismarking five dozen order tickets.


In the current case, the broker “went behind the back” of her member firm once again, this time to borrow money from a securities customer, who was also a friend. The broker borrowed $75,000 on 12/1/16 for the purpose of purchasing a house – without any documented loan agreement, schedule for repayment, implied interest rate, collateral, or other key terms of the loan. Instead, when the customer asked the broker to repay the loan 5 months later, she did so.


Around the time that the loan was repaid, the broker sent approximately 20 text messages about securities to the customer – and she shared none of these with her member firm. Among those messages, the broker addressed:

  • specific transactions, such as orders to sell certain option contracts;
  • investment strategies, such as whether the customer should sell a certain issuer's securities;
  • the performance of the customer’s accounts; and,
  • a complaint the customer had about the broker’s trading practices.


FINANCIALISH TAKE AWAYS.    At first blush, the 5-month suspension seemed rather harsh for the violations committed by this broker. Yet, after closer inspection, I now believe the sanctions were fitting. Through its sanctions, FINRA issued a statement to this broker that it will no longer tolerate her repeated and intentional violations and cover-ups - regardless of the relative seriousness of any particular violation or action. From this point forward, there will be no room for lies and deceit.


This case was reported in FINRA Disciplinary Actions for March 2018.

For details on this case, go to ...  FINRA Disciplinary Actions Online, and refer to Case #2017054579101.