August 2019 FINRA Disciplinary Actions
FINRA disciplinary actions taken against firms and individuals due to violations of FINRA rules, federal securities laws and MSRB rules.
Firm Fined
Robert W. Baird & Co. Incorporated (Milwaukee, Wisconsin)
The Firm was censured and fined $150,000 for publishing seven (7) research reports authored by an analyst that was in employment discussions with the issuer. This created a material conflict of interest. During these discussions, there was no disclosure added to the report stating that the author was considering employment with the issuer. This resulted in misleading research reports and compromised Broker-Dealer compliance. (FINRA Case #2017052842901)
Edward D. Jones & Co., L.P. (St. Louis, Missouri)
The Firm was censured, fined $40,000 and was instructed to revise its customer complaint policy, specifically in regard to disclosing customer complaints, which caused the FINRA disciplinary action. It was found that the Firm made inaccurate Form U4 filings in regard to the amount of damages related to customer complaints. This occurred as a result of misunderstandings among associates as to filing requirements. The Firm instituted new training guidelines and safeguards to ensure all associates are aware of the proper filing guidelines related to customer complaints. (FINRA Case #2018056422401)
Individuals Barred
Daniel Robert Rozzi (Oakland, New Jersey)
Rozzi was barred from association with any FINRA member for failing to report a civil judgement made against him. The civil judgement was in the amount of $14,789. It was also found that Rozzi falsely responded to a FINRA personal activity questionnaire in connection with a sales practice exam and submitted false written responses to FINRA in regard to the civil judgement. (FINRA Case #2017056611801)
Amanda Justine Sarabia (El Paso, Texas)
Sarabia was barred from association with any FINRA member for failing to provide FINRA requested documents and failing to appear and provide on-the-record testimony requested by FINRA in regard to converting funds from a coworker at her former member firm. It was alleged that Sarabia stole $200 from a coworker by stealing a blank check. Sarabia then made the check payable to cash and cashed the check. (FINRA Case #2018057635002)
Individuals Suspended
Stephen C. Carver (Chillicothe, Illinois)
Carver was fined $7,500 and suspended from association with any FINRA member firm for seven (7) months. It was found that Carver failed to disclose three (3) tax liens on his Form U4. It was also found that Carver falsely attested on the Firm’s annual certification that all pertinent liens were disclosed when in actuality they were not. (FINRA Case #2017056071301)
Kyung Soo Kim (Houston, Texas)
Kim was fined $5,000 and suspended from association with any FINRA member for one (1) month. It was found that Kim formed and incorporated an outside business activity without providing prior written notice to his member Firm. Kim was the sole shareholder and director in his cryptocurrency mining business. (FINRA Case #2018058100701)
Click here to read the Disciplinary Brief in its entirety.
FINRA disciplinary actions can be very costly and harm a Firm’s reputation. Please contact an ARG Analyst with any questions regarding the matters discussed, or to learn the benefits of our FINRA consulting services for Broker-Dealer compliance.
