FINRA investigation Archives - Securities Law Attorneys Blog

Alex James, formerly of Allstate Financial Services, Under Investigation by FINRA for Undisclosed Outside Business Activities

March 24, 2020 | by Fitapelli Kurta

Alex James (CRD#: 5630825), a former registered representative with Allstate Financial Services LLC (CRD#: 18272) in West Palm Beach, Florida, is currently being investigated by the Financial Industry Regulatory Authority (FINRA) for potentially undisclosed outside business activities, according to his BrokerCheck record accessed on March 16, 2020.

What happened to lead to this FINRA investigation? On March 6, 2020, FINRA recommended that disciplinary action be brought against Alex James for violating FINRA Rule 3270 and FINRA Rule 2010. FINRA Rule 3270 mandates that brokers receive written approval from their member firms before engaging in any outside business activities. FINRA alleges that Alex James did not do that, instead engaging in private securities activities totaling approximately $667,000. FINRA Rule 2010 mandates that brokers act in a professional manner, and FINRA alleges that Alex James violated Rule 2010 by allegedly providing false information to his firm on annual compliance questionnaires, stating that he reported all outside business activities when that was allegedly not true.

The Detailed Report of Alex James’s BrokerCheck record lists four outside business activities:

Securities America Sanctioned Over Variable Annuity Allegations, Fined $175,000

October 5, 2018 | by Fitapelli Kurta

Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) and accessed on October 4, 2018 indicate that Nebraska-based brokerage firm Securities America was recently sanctioned by FINRA in connection to alleged rule violations. Fitapelli Kurta is interested in hearing from investors who have complaints regarding Securities America (CRD# 10205).

Established in Delaware in 1984, Securities America is headquartered in La Vista, Nebraska and registered with 53 US states and territories. According to the firm’s BrokerCheck report, it has been involved in 53 regulatory events and 27 customer complaints that evolved into arbitration.

In September 2018 FINRA sanctioned the firm in connection to allegations it failed to maintain and enforce a supervisory system and written supervisory procedures that were reasonably designed to ensure that its representatives recommendations of variable annuity investments were in compliance with relevant laws, rules and regulations. FINRA’s findings stated additionally that though the firm sold variable annuity contracts with options for different share classes, its procedures “did not specifically address the suitability issues pertaining to the fees and costs or surrender periods of the different variable annuity share classes,” and that they also failed to address when “additional scrutiny” might be necessary during the firm’s principal review and approval process for variable annuity transactions. In connection with these and other findings, the firm was censured and issued a fine of $175,000.

Cadaret Grant & Company Sanctioned Over Alleged Supervisory Failures, Fined $800,000

October 5, 2018 | by Fitapelli Kurta

Publicly available records published by the Financial Industry Regulatory Authority (FINRA) and accessed on October 4, 2018 indicate that New York-based broker-dealer firm Cadaret Grant & Company was recently sanctioned by FINRA in connection to alleged rule violations. Fitapelli Kurta is interested in hearing from investors who have complaints Cadaret Grant & Company (CRD# 10641).

Established in Delaware in 1981, Cadaret Grant & Company is headquartered in Syracuse, New York and registered with 52 US states and territories. According to its BrokerCheck report, it has been involved in 14 regulatory events and four customer complaints that evolved into arbitration.

In September 2018 FINRA sanctioned the firm in connection to allegations it failed to establish reasonably designed supervisory systems and procedures “with respect to numerous areas of its business.” Among other findings, FINRA stated that the firm’s supervisory failures were in part due to its failure to dedicate sufficient resources to the supervision of firm personnel, and that it failed to create and maintain a system that was reasonably designed to ensure that representatives made investment recommendations that were suitable for customers and that complied with relevant securities rules and regulations. In connection to these allegations, the firm was censured and issued a fine of $800,000.

Stifel Nicolaus and Company Sanctioned Over OTC Trading Allegations

October 5, 2018 | by Fitapelli Kurta

Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) and accessed on October 4, 2018 indicate that Missouri-based broker-dealer firm Stifel Nicolaus & Company was recently sanctioned by FINRA in connection to alleged rule violations. Fitapelli Kurta is interested in hearing from investors who have complaints Stifel Nicolaus & Company (CRD# 793).

Established in Missouri in 1900, Stifel Niclaus & Company is headquartered in St. Louis, Missouri and registered with 53 US states and territories. According to its BrokerCheck report, it has been involved in 128 regulatory events and 48 customer complaints that evolved into arbitration.

In September 2018 FINRA sanctioned the firm in connection to allegations it “accepted and held customer orders in over-the-counter (OTC) securities… for its own account and prices that would have satisfied the customer orders, and failed to execute or immediately execute the customer orders up to the size and at the same price at which it traded for its own account or at a better price.” FINRA’s findings state additionally that as many as 45,024 of the firm’s order audit trail system (OATS) reports were inaccurate, in that they contained an “inaccurate information barrier identifier.” FINRA alleged further that the firm’s supervisory system failed to provide for supervision that was not reasonably designed to achieve compliance with relevant securities laws and regulations. The firm was censured, issued a fine of $37,500, and ordered to pay restitution to affected customers.

Lincoln Investment Planning Sanctioned Over Variable Annuity Exchanges

October 5, 2018 | by Fitapelli Kurta

Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) and accessed on October 4, 2018 indicate that Pennsylvania-based broker-dealer firm Lincoln Investment Planning was recently sanctioned by FINRA in connection to alleged rule violations. Fitapelli Kurta is interested in hearing from investors who have complaints regarding Lincoln Investment Planning (CRD# 519).

Established in Pennsylvania in 2015, Lincoln Investment Planning is headquartered in Fort Washington, Pennsylvania and registered with 53 US states and territories. According to its BrokerCheck report, it has received six regulatory sanctions.

In September 2018 FINRA sanctioned the firm in connection to allegations it failed to implement surveillance procedures that were reasonably designed to monitor the firm’s representatives’ “rates of effecting variable annuity exchanges.” According to FINRA’s findings, the firm only engaged in tracking of exchanges where the firm was the annuity’s broker of record, and overlooked exchanges where the firm was not the annuity’s broker of record. FINRA also stated that over 50% of the ~2,800 annuity exchanges conducted by its representatives were not included in its surveillance report because of these oversights. The firm was censured and issued a fine of $35,000, in addition to correcting its surveillance report such that it includes all variable annuity exchanges.

First Financial Equity’s Jeffrey Sigman Terminated Over Outside Business Activities

August 16, 2018 | by Fitapelli Kurta

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Publicly records provided by the Financial Industry Regulatory Authority (FINRA) and accessed on August 16, 2018 indicate that former Colorado-based First Financial Equity Corporation broker/adviser Jeffrey Sigman, who has been named in a pending FINRA investigation, was recently discharged from his former employer in connection to alleged rule violations and is currently not affiliated with any broker-dealer firm. Fitapelli Kurta is interested in hearing from investors who have complaints regarding Mr. Sigman (CRD# 1418621).

Jeffrey Sigman has spent 31 years in the securities industry and was most recently registered with First Financial Equity Corporation in Greenwood Village, Colorado (2017-2018). Previous registrations include Neidiger Tucker Bruner in Englewood, Colorado (2001-2016); Owen-Joseph Securities in San Diego, California (1996-2001); Painewebber in Weehawken, New Jersey (1991-1996); Prudential Securities in New York, New York (1988-1991); and EF Hutton & Company (1985-1988). He has passed seven securities industry examinations: Series 65 (Uniform Investment Adviser Law Examination), which he obtained on May 13, 1997; Series 63 (Uniform Securities Agent State Law Examination), which he obtained on November 4, 1985; Series 15 (Foreign Currency Options Examination), which he obtained on February 22, 1990; Series 3 (National Commodity Futures Examination), which he obtained on July 2, 1986; Series 7 (General Securities Representative Examination), which he obtained on October 19, 1985; Series 4 (Registered Options Principal Examination), which he obtained on February 16, 2010; and Series 24 (General Securities Principal Examination), which he obtained on April 28, 1998. He is currently not registered with any state or firm.

Randy Carpen Recently Named in FINRA Investigation

June 18, 2018 | by Fitapelli Kurta

Public records provided by the Financial Industry Regulatory Authority (FINRA) and accessed on June 15, 2018 indicate that former Missouri-based Vestech Securities broker Randy Carpen, who has received resolved or pending customer disputes, was recently named in a FINRA investigation into alleged rule violations. Fitapelli Kurta is interested in speaking to investors who have complaints regarding Mr. Carpen (CRD# 2469877).

Randy Carpen has spent 20 years in the securities industry and was most recently registered with Vestech Securities in St. Louis, Missouri (2017-2018). Previous registrations include IBN Securities in Liverpool, New York (2017); Freedom Investors Corporation in Brookfield, Wisconsin (2015-2017); Newbridge Securities Corporation in Boca Raton, Florida (2013-2014); Westpark Capital in Fort Lauderdale, Florida (2013); CBG Financial Group in Fort Lauderdale, Florida (2012-2013); EKN Financial Services in Fort Lauderdale, Florida (2010-2012); Jesup & Lamont Securities Corporation in Fort Lauderdale, Florida (2008-2010); Gunnallen Financial in Fort Lauderdale, Florida (2007-2008); Gunnallen Financial in Tampa, Florida (2002-2003; 2005-2006); First Montauk Securities in Red Bank, New Jersey (2001-2002); First Liberty Investment Group in Philadelphia, Pennsylvania (1998-2001); VTR Capital in New York, New York (1997-1998); Sovereign Equity Management Corporation in Deerfield Beach, Florida (1996-1997); Biltmore Securities in Fort Lauderdale, Florida (1996); GKN Securities Corporation in New York, New York (1995-1996); and First United Equities Corporation in New York, New York (1995). He has passed three securities industry examinations: Series 63 (Uniform Securities Agent State Law Examination), which he obtained on December 14, 1994; Series 7 (General Securities Representative Examination), which he obtained on November 19, 1994; and Series 24 (General Securities Principal Examination), which he obtained on April 17, 1997. He is currently not registered with any state or firm.

According to his BrokerCheck report, he has received one customer complaint and one pending customer complaint, and he was recently named in a FINRA investigation.

Lloyd Johnston: Sanctioned, Discharged, Named in Investigation, Multiple Tax Liens

June 7, 2018 | by Fitapelli Kurta

Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) and accessed on June 6, 2018 indicate that former Washington-based Capital Financial Services broker/adviser Lloyd Johnston, who has received a pending customer dispute, was recently discharged from his former employer in connection to alleged rule violations and is currently not affiliated with any broker-dealer firm. Fitapelli Kurta is interested in speaking to investors who have complaints regarding Mr. Johnston (CRD# 1626695).

Lloyd Johnston has spent 27 years in the securities industry and was most recently registered with Capital Financial Services in Spokane, Washington (2006-2018). Previous registrations include Legacy Financial Services in Clinton, Maryland (2004-2006); Investors Capital Corporation in Lynnfield, Massachusetts (1996-2004); Intersecurities in St. Petersburg, Florida (1992-1993); and Pruco Securities Corporation in Newark, New Jersey (1987-1992). He has passed five securities industry examinations: Series 65 (Uniform Investment Adviser Law Examination), which he obtained on May 29, 1998; Series 63 (Uniform Securities Agent State Law Examination), which he obtained on July 19, 1996; Series 7 (General Securities Representative Examination), which he obtained on July 25, 1997; Series 6 (Investment Company Products/Variable Contracts Representative Examination), which he obtained on February 23, 1987; and Series 26 (Investment Company Products/Variable Contracts Principal Examination), which he obtained on April 30, 1996. He is currently not registered with any state or firm.

According to his BrokerCheck report, Lloyd Johnston has received one pending customer complaint and one regulatory sanction, has been named in a FINRA investigation and was recently discharged from his former employer in connection to alleged rule violations. He has also received 15 unsatisfied judgments or liens.

James Kujawski Terminated From UBS, Named in Investigation

June 6, 2018 | by Fitapelli Kurta

Public records provided by the Financial Industry Regulatory Authority (FINRA) and accessed on June 5, 2018 indicate that former Maryland-based Ameriprise Financial Services broker/adviser James Kujawski, who has received resolved or pending customer disputes, was recently named in a FINRA investigation into alleged rule violations. Fitapelli Kurta is interested in speaking to investors who have complaints regarding Mr. Kujawski (CRD# 2075543).

James Kujawski has spent 27 years in the securities industry and has been registered with Ameriprise Financial Services in Annapolis, Maryland since March 2018. Previous registrations include UBS Financial Services in Annapolis, Maryland (2009-2018); Morgan Stanley & Company in Annapolis, Maryland (2007-2009); Morgan Stanley & DW in Annapolis, Maryland (1999-2007); Prudential Securities in New York, New York (1997-1999); Smith Barney in New York, New York (1993-1997); and Lehman Brothers in New York, New York (1990-1993). He has passed four securities industry examinations: Series 65 (Uniform Investment Adviser Law Examination), which he obtained on May 7, 1992; Series 63 (Uniform Securities Agent State Law Examination), which he obtained on September 21, 1990; Series 31 (Futures Managed Funds Examination), which he obtained on February 29, 2000; and Series 7 (General Securities Representative Examination), which he obtained on August 31, 1990. He is a registered broker and investment adviser in Maryland and the District of Columbia.

According to his BrokerCheck report, he has received four customer complaints and one pending customer complaint, and he was recently named in a FINRA investigation into alleged rule violations.

Matthew Eckstein Received One Regulatory Sanction and One FINRA Complaint

May 18, 2018 | by Fitapelli Kurta

Publicly available records published by the Financial Industry Regulatory Authority (FINRA) and accessed on May 16, 2018 indicate that New York-based Sisk Investment Services broker Matthew Eckstein has been named respondent in a pending FINRA complaint. Fitapelli Kurta is interested in speaking to investors who have complaints regarding Mr. Eckstein (CRD# 2997245).

Matthew Eckstein has spent 20 years in the securities industry and has been registered with Sisk Investment Services in Syosset, New York since 2015. He was previously registered with Gould Ambroson & Associates in Garden City, New York 91998-2015). He has passed three securities industry examinations: Series 63 (Uniform Securities Agent State Law Examination), which he obtained on April 4, 1998; Series 7 (General Securities Representative Examination), which he obtained on February 11, 1998; and Series 24 (General Securities Principal Examination), which he obtained on November 25, 1998. He is a registered broker with nine US states: Colorado, Connecticut, Florida, Minnesota, New Jersey, New York, North Carolina, Pennsylvania, and Virginia.

According to his BrokerCheck report, Matthew Eckstein has received one regulatory sanction and one pending regulatory complaint.