March 2022 FINRA Disciplinary Actions
Firms Fined
Jefferies, LLC
An AWC was issued, and the Firm was censured and fined $55,000 for failing to timely report to Trade Reporting and Compliance Engine (TRACE) transactions in TRACE-eligible corporate debt securities. It was found that reports were late due to several issues at the Firm. These issues included delays related to manually reporting trades involved with foreign affiliates and operational errors. Additionally, the Firms personnel caused delays such as untimely matching of tickets in the Firm’s system and making amendments to trade terms outside of the 15-minute reporting time frame. (FINRA Case #2018060219201)
Third Seven Capital LLC
An AWC was issued, and the Firm was censured and fined $10,000 for failing to maintain the minimum net capital requirement. The Firm had incurred $16,832.71in legal fees, causing its net capital to fall below the minimum requirement and had daily deficiencies between $726 and $29,665. The findings stated that the firm inaccurately filed net capital deficiency notices with FINRA and the SEC, stating that the net capital deficiency ended after the Firm received funds from a particular private placement. The Firm mistakenly did not include certain legal fees in its net capital calculations; therefore, its net capital was still below the minimum requirement. The Firm filed an amended notification with the SEC and FINRA which stated that its net capital deficiencies had not ended and continued until the amended notification date, but this proved to be inaccurate as well as the Firm incorrectly recorded certain credits related to rent and software invoices as debits. Therefore, the amended notification was also inaccurate and the Firm’s net capital continued to be deficient until the following month after the amended notification was filed. Lastly, the findings concluded that the Firm did not properly maintain its books and records concerning aggregate indebtedness and net capital and that the Firm’s FOCUS report stated an incorrect amount of the net capital deficiency. (FINRA Case #2020065094701)
Individuals Barred
Thomas John Lykos Jr.
Lykos was barred from association with any FINRA member in all capacities for acting unethically, cheating, and violating the Rules of Conduct governing examinations when attempting to take a qualification exam. Lykos was found to have written test questions and answers on his driver’s license as well as in between his fingers. During his exam, Lykos took a break, visited a nearby bank where he knew a bank teller, and accessed an unmonitored computer. Upon returning from his break, evidence shows Lykos had writing on his hands. He also spent roughly 14 minutes looking over questions on the exam that he had already answered and changed the answers to two questions, which was the only time he had changed an answer during the exam. An NAC decision to the SEC was appealed by Lykos and the bar is in effect pending review. (FINRA Case #2018059510201)
Tarek Mohsen Mohamed
Mohamed was issued an Order Accepting Offer of Settlement and was barred from association with any FINRA member in all capacities for failing to provide a complete response to FINRA when requested to provide information and documents. The information and documents were requested to determine if Mohamed converted client funds, improperly failed to disclose his OBAs to his member firm or engaged in other misconduct in violation of FINRA rules and federal securities laws. (FINRA Case #2020067814802)
Individuals Suspended
Mark Giordano
An AWC was issued, and Giordano was fined $5,000 as well as suspended from association with any FINRA member in all capacities for two months for engaging in non-securities related OBA’s in which he received compensation but did not disclose to his member firm. Giordano served as a part owner and vice president of a company involved in horse racing and breeding and as a part owner in a second company involved in horse racing. Giordano was also involved in real estate, serving as part owner and president of a real estate rental company, owning a real estate-flipping company, and engaging in a house-flipping venture to purchase, renovate and sell residential properties. Giordano’s member firm customers were involved in all activities, except one, and all activities were outside the scope of Giordano’s relationship with his member firm. It was found that Giordano never disclosed one activity and did not timely disclose the other activities. (FINRA Case #2019063042401)
Jimmy William Nunez Jr.
An AWC was issued, and Nunez was assessed a deferred fine of $10,000 and suspended from association with any FINRA member in all capacities for two years for forging a customer’s signature and initials on a variable annuity application and other new account documents. Nunez failed to obtain permission from the customer to sign or initial any of the documents. Nunez was also found falsifying the documents by placing a date on the forms that was later than the date they were signed. After forging and falsifying, Nunez then submitted the documents to his member firm and in doing so, caused the firm’s books and records to be inaccurate. While FINRA investigated Nunez, he provided false written statements and testimony, then subsequently recanted his false statements. (FINRA Case #2020065945901)
