The following disciplinary actions were taken against both firms and individuals due to violations of FINRA rules, federal securities laws and MSRB rules:
Cetera Advisor Networks LLC
The Firm was fined $700,000 and ordered to pay $691,755.27 in restitution to customers for failing to identify red flags of unsuitable mutual fund switching and unsuitable stock trading that ensued to conceal the switching by a Registered Representative (“RR”) of the Firm. The Firm found through annual audits and trade reports that the RR was involved in the unsuitable activities but did not enforce disciplinary action. It was also found that the RR’s supervisor was not properly overseeing the RR and was profiting from the commissions. FINRA Case #2014040951702
NTB Financial Corporation
The Firm was fined $45,000 and voluntarily paid restitution to customers totaling over $43,000 for charging customers unfair prices. It was found that the Firm did not consider important factors when deciding mark-ups charged to customers of the Firm. As a result, the Firm charged customers $43,142.06 in disproportionate markups on corporate bonds.
FINRA Case #2015047738901
Michael Lee Prikopa
It was found that Prikopa converted $6,400 from a senior citizen customer of his member firm’s bank affiliate. Prikopa was also found to have ordered a debit card for the customer’s account without authorization. With the debit card, the individual then withdrew funds and used them for his own benefit. FINRA Case #2017056708001
Craig Scott Hartman
Hartman was banned from association with any FINRA member for failing to appear and provide FINRA with on-the-record testimony after his member firm filed a U5. The member Firm filed a Form U5 because Hartman willfully failed to disclose tax liens filed against him that amounted to $206,409.54 and for falsely telling his member Firm that his U4 was accurate when it was not. FINRA Case #2016052604602
Peter Chris Marketos
The individual was fined $20,000, suspended for one year, ordered to pay over $5,000 in restitution to a customer and required to complete 10 hours of continuing education. Marketos made unsuitable recommendations which concentrated the customers’ investments in speculative, high yield bonds and failed to accurately explain the risk and benefits of high yield bonds. It was also found that many of the company bonds that were recommended had declared bankruptcy which caused customers to lose principal. FINRA Case #2016049840101
The individual was suspended for three months, fined $2,500 and required to complete 10 hours of continuing education within 60 days of being re-associated with a member firm. Velicki was found to have given his assistant his personal login information to access and complete his firm element requirements while traveling. FINRA Case #2017056514301
These cases along with others can be accessed by clicking this link.
Please contact an ARG Analyst with any questions regarding the matters discussed.