FINRA Enforcement Actions 2011

Donald Barry Weidenfeld, Registered Principal, Del Ray Beach, Florida

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

FINRA Securities Fraud, Misrepresentation and Mismanagement Attorney, Russell L. Forkey, Esq.

May, 2011

Donald Barry Weidenfeld (CRD #1751232, Registered Principal, Del Ray Beach, Florida, currently licensed with Raymond James & Associates, Inc.) submitted a Letter of Acceptance, Waiver and Consent in which he was fined $5,000 and suspended from association with any FINRA member in any capacity for one month. In determining sanctions, FINRA took into account the disciplinary action taken by Weidenfeld’s member firm for the same conduct. Without admitting or denying the findings, Weidenfeld consented to the described sanctions and to the entry of findings that he exercised discretion in a customer’s account, which was a commission-based, nondiscretionary account, at his member firm without the customer’s written authorization and his firm’s acceptance of the account as discretionary. The findings stated that Weidenfeld was the broker of record for the customer’s account at his firm. The findings also stated that Weidenfeld completed annual certifications for his firm wherein he inaccurately attested that he had not exercised discretion in any non fee-based customer accounts. The suspension is in effect from April 18, 2011, through May 17, 2011. (FINRA Case #2009016703901).

Nathan Mark Spiegel, Registered Representative, Ankeny, Iowa

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

FINRA Securities Fraud and Misrepresentation Arbitration Attorney, Russell L. Forkey, Esq.

May, 2011

Nathan Mark Spiegel (CRD #4823748, Registered Representative, Ankeny, Iowa, formerly licensed with Edward Jones) submitted a Letter of Acceptance, Waiver and Consent in which he was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, Spiegel consented to the described sanction and to the entry of findings that he executed mutual fund and equity transactions in customers’ accounts without their knowledge or authorization. The findings stated that Spiegel executed the equity transactions to generate commission revenue for himself and not to benefit the customers. The findings also stated that Spiegel executed mutual fund and equity transactions in the customers’ accounts pursuant to their prior verbal grant of discretionary authority to Spiegel. The findings also included that the customers did not provide Spiegel with written documentation granting him the authority to execute transactions for their accounts without first obtaining their approval, and Spiegel’s member firm did not approve the accounts as discretionary. FINRA found that Spiegel executed transactions in some of the customers’ accounts to generate commission revenue for himself and not to benefit the customers. FINRA also found a customer verbally authorized Spiegel to accept investment instructions from a relative, but the customer did not execute any document granting trading authority to the relative and he did not have power-of-attorney for the account. In addition, FINRA determined that Spiegel executed equity and mutual fund transactions for the customer’s account pursuant to the relative’s instructions. (FINRA Case #2009018220501)

Ryan Seth Sackstein, Registered Representative, Hewlett, New York

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

FINRA Securities Fraud, Mismanagement and Misrepresentation Attorney, Russell L. Forkey, Esq.

May, 2011

Ryan Seth Sackstein (CRD #4304667, Registered Representative, Hewlett, New York formerly licensed with Investors Capital Corporation) was barred from association with any FINRA member in any capacity. The sanction was based on findings that Sackstein requested a customer sign a written agreement, drafted on his member firm’s letterhead, authorizing Sackstein to exercise discretion in sales transactions in an account, contrary to his member firm’s policies and procedures prohibiting commission-based discretionary accounts, absent exceptional circumstances. The findings stated that Sackstein did not notify his firm of the agreement nor obtain firm approval to exercise discretion in the customer’s account. The findings also stated that despite the customer’s request to stop trading in his account, Sackstein executed unauthorized trades in the customer’s accounts until the customer contacted Sackstein’s firm, requesting that trading be halted and Sackstein be removed as his assigned registered representative. The findings also included that Sackstein failed to testify at a FINRA on-the-record interview. (FINRA Case #2008015914601)

Jose Antonio Rivera, Registered Representative, Fort Myers, Florida

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

Florida FINRA Securities Fraud and Misrepresentation Attorney, Russell L. Forkey, Esq.

May, 2011

Jose Antonio Rivera (CRD #1822783, Registered Representative, Fort Myers, Florida, formerly licensed with Invest Financial Corporation and Morgan Stanley Smith Barney) submitted a Letter of Acceptance, Waiver and Consent in which he was fined $5,000 and suspended from association with any FINRA member in any capacity for three months. The fine must be paid either immediately upon Rivera’s reassociation with a FINRA member firm following his suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. Without admitting or denying the findings, Rivera consented to the described sanctions and to the entry of findings that he borrowed a total of approximately $19,000 from a firm customer, signing promissory notes for the loans, contrary to firm policy that prohibited representatives from borrowing from a customer unless the customer was an immediate family member and the representative received the firm’s prior written approval. The findings stated that the customer was not a family member and Rivera never informed the firm of the loan. The findings also stated that Rivera failed to repay the funds in full and his firm entered into a settlement with the customer, repaying the $17,700 still owed to the customer; Rivera did not make any contribution to the settlement. The suspension is in effect from April 4, 2011, through July 3, 2011. (FINRA Case #2010022031601).

Penena Karpel McRoberts, Registered Representative, Austin, Texas

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

FINRA Securities Fraud and Misrepresentation Attorney, Russell L. Forkey, Esq.

May, 2011

Penena Karpel McRoberts (CRD #1909901, Registered Representative, Austin, Texas, formerly licensed with LPL Financial Corporation and Next Financial Group, Inc.) submitted a Letter of Acceptance, Waiver and Consent in which she was fined $20,000, which includes the disgorgement of commissions received of $9,600, and suspended from association with any FINRA member in any capacity for one year. The fine must be paid either immediately upon McRoberts’ reassociation with a FINRA member firm following her suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. Without admitting or denying the findings, McRoberts consented to the described sanctions and to the entry of findings that she effected private securities transactions without requesting and receiving her member firms’ permission. The findings stated that McRoberts sold $142,128 in promissory notes secured by pooled life settlements. The findings also stated that prior to engaging in these transactions, while associated with one of the firms, McRoberts had signed an Acknowledgment of Receipt and Review of Compliance Procedure Manual which stated that no private securities (or other investment or insurance) transaction may in any way be participated in by a representative unless the compliance director approves it in advance. The findings also included that despite McRoberts’ acknowledgment of the firm’s procedures, she failed to give written notice of her intention to participate in the sale of the securities to, and failed to obtain written approval from, her firm prior to the transactions. FINRA found that McRoberts effected private securities transactions while registered with another member firm and also failed to give written notice of her intention to participate in the sale of the securities, and failed to obtain her firm’s written approval prior to the transaction. FINRA also found that McRoberts received $9,600 in commissions from the transactions. In addition, FINRA determined that the investments McRoberts sold were not suitable for her clients; McRoberts failed to conduct adequate due diligence and thus had no reasonable basis to determine whether the investments were suitable for her clients. The suspension is in effect from March 21, 2011, through March 20, 2012. (FINRA Case #2009017606101).

Devon Coulin McLean, Registered Representative, Homestead, Florida

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

South Florida, FINRA Securities Fraud and Mismanagement Attorney, Russell L. Forkey, Esq.

May, 2011

Devon Coulin McLean (CRD #4072332, Registered Representative, Homestead, Florida, formerly licensed with Questar Capital Corporation) submitted a Letter of Acceptance, Waiver and Consent in which he was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, McLean consented to the described sanction and to the entry of findings that he failed to provide written notice of his involvement in unapproved private securities transactions to his member firm and lied to his firm during monthly supervisory meetings. The findings stated that McLean’s member firm prohibited its registered representatives from engaging in any private securities transactions unless they were personal investments and only after obtaining the firm’s prior written approval, but McLean referred a customer and another individual to someone who was raising monies for real estate projects. The findings also stated that these individuals invested approximately $75,000 in promissory notes with entities controlled by the individual to whom McLean referred them, and McLean received $1,500 in cash for the referrals. The findings also included that due to concerns stemming from items reported on McLean’s personal credit report, his firm placed him on heightened supervision and, among other things, McLean was required to meet with his supervisor monthly to discuss securities-related and outside business activities; but not once during these meetings did McLean disclose his involvement with the individual. FINRA found that in fact, on seven separate occasions, he signed statements affirming that he was not engaged in outside business activity beyond those already disclosed and that it was unnecessary to update his Form U4. FINRA also found that while employed by another member firm, McLean acted as an agent for an entity not affiliated with his firm and over which his firm had no control, without providing written notice to his firm or receiving his firm’s approval to serve in this role. In addition, FINRA determined that as an agent for the entity, McLean introduced individuals to an individual through whom they invested in a purported diamond mining operation. Moreover, FINRA found that these individuals entered into promissory notes, investing more than $40,000 with an entity the individual controlled. Furthermore, FINRA found that in addition to making referrals, as an agent for the entity, McLean was expected to provide financial and consulting advice to investors once their investments began earning profits, and in exchange, McLean stood to earn $2 million worth of shares in a company the individual controlled. The findings also stated that McLean failed to respond fully to FINRA requests for documents and information. (FINRA Case #2009016806001).

Marco Antonio Martin, Registered Representative, Toronto, Canada

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

FINRA Securities Fraud, Misrepresentation and Mismanagement Arbitration Attorney, Russell L. Forkey, Esq.

May, 2011

Marco Antonio Martin (CRD #3100944, Registered Representative, Toronto, Canada, formerly Citigroup Global Markets, Inc.) submitted an Offer of Settlement in which he was barred from association with any FINRA member in any capacity. Without admitting or denying the allegations, Martin consented to the described sanction and to the entry of findings that he executed more than 50 unauthorized trades in a customer account and hid the losses that resulted from the unauthorized trades by sending the customer false and misleading monthly account summaries over a period of nearly two years that misrepresented the value of the account and failed to accurately reflect the substantial losses that had been incurred. The findings stated that Martin purchased mutual fund shares for another customer’s account at the cost of $126,000 without the customer’s prior authorization or approval. (FINRA Case #2008014982901).

Cesar Madrigal, Registered Representative, Deer Park, Texas

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

FINRA Securities Fraud, Misrepresentation and Mismanagement Attorney, Russell L. Forkey, Esq.

May, 2011

Cesar Madrigal (CRD #4572698, Registered Representative, Deer Park, Texas, formerly registered with Wells Fargo Advisors, LLC.) was barred from association with any FINRA member in any capacity. The sanction was based on findings that Madrigal misappropriated $102,054.55 from customers’ bank accounts by using forged customer signatures on partial withdrawal general ledger tickets. The findings stated that Madrigal admitted to his member that he had engaged in this misconduct. The findings also stated that Madrigal failed to respond to FINRA requests for information. (FINRA Case #2009019322001).

Michael Steven Jacobson, Registered Representative, Coral Springs, Florida

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

South Florida Securities Fraud, Misrepresentation and Mismanagement Attorney, Russell L. Forkey, Esq.

May, 2011

Michael Steven Jacobson (CRD #2042591, Registered Representative, Coral Springs, Florida, formerly licensed with Princor Financial Services Corporation and Met Life Securities) submitted a Letter of Acceptance, Waiver and Consent in which he was fined $5,000 and suspended from association with any FINRA member in any capacity for 18 months. The fine must be paid either immediately upon Jacobson’s reassociation with a FINRA member firm following his suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. Without admitting or denying the findings, Jacobson consented to the described sanctions and to the entry of findings that he sold EIAs outside the scope of his employment relationship with a member firm, and received approximately $488,266.41 in compensation. The findings stated that Jacobson failed to give prompt written notice to his firm of his outside business activity and represented on annual certification statements and/or outside business activity forms that he was either not engaged in outside business activity or had previously disclosed such activity; these representations were false. The findings also stated that despite a specific verbal warning from his firm to discontinue selling EIAs outside his firm’s agency, he continued to do so despite the firm’s specific prohibition against doing so in its WSPs. The suspension is in effect from April 4, 2011, through October 3, 2012. (FINRA Case #2009017282401).

William Thomas Hernandez, Reg. Rep., Louisville, Kentucky

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

FINRA Securities Fraud, Misrepresentation and Mismanagement Attorney, Russell L. Forkey, Esq.

May, 2011

William Thomas Hernandez (CRD #2815703, Registered Representative, Louisville, Kentucky, formerly licensed with PNC Investments) submitted a Letter of Acceptance, Waiver and Consent in which he was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, Hernandez consented to the described sanction and to the entry of findings that he converted a total of $98,559.12 from elderly customers for his own personal use and benefit. The findings stated that Hernandez received checks totaling $14,378.27 from a customer to be deposited into the customer’s brokerage account at his member firm for investment purposes. The findings also stated that Hernandez did not invest those funds; instead, he deposited the checks into his personal checking account. The findings also included that Hernandez, without any authorization, withdrew $60,220.85 from a checking account belonging to a customer of his firm’s bank affiliate and then deposited those funds into his personal investment account, converting the proceeds for his own use and benefit. FINRA found that Hernandez, again without any authorization, withdrew another $24,000 from that same customer’s account and deposited the funds into his personal checking account. FINRA also found that Hernandez failed to respond to FINRA requests for information and documents. (FINRA Case #2010025260501).