Statutory Disqualification Index
SEC and FINRA
CASES OF NOTE
SD02007
NOTE: Stipulations of Fact and Consent to Penalty (SFC); Offers of Settlement (OS); and Letters of Acceptance Waiver, and Consent (AWC) are entered into by Respondents without admitting or denying the allegations, but consent is given to the described sanctions & to the entry of findings. Additionally, for AWCs, if FINRA has reason to believe a violation has occurred and the member or associated person does not dispute the violation, FINRA may prepare and request that the member or associated person execute a letter accepting a finding of violation, consenting to the imposition of sanctions, and agreeing to waive such member's or associated person's right to a hearing before a hearing panel, and any right of appeal to the National Adjudicatory Council, the SEC, and the courts, or to otherwise challenge the validity of the letter, if the letter is accepted. The letter shall describe the act or practice engaged in or omitted, the rule, regulation, or statutory provision violated, and the sanction or sanctions to be imposed.

In the Matter of the Continued Association of X as a General Securities Representative with the Sponsoring Firm 

MC-400:  January 2002 

Redacted Decision
SD Decision No. 02007

APPROVED without hearing upon the recommendation of the Department of Member Regulation in accordance with NASD Procedural Rule 9523

Filed Under: Permanent Injunction, Approval w/o hearing
SD Event

1984 Permanent Injunction and Order of Disgorgement by US District Court.  SEC administrative proceeding barring X with proviso for application after 12 months.

Sentence Expiration
N/A
Prior Industry Activity

Prior Firm 1 activity: NYSE approved 1985 association as a bond trader/special limited partner.  NYSE approved 1986 Allied Member/general partner.  NYSE approved 1992 RR/bond trader/special limited partner.  NASD approved 1994 RR with current Firm, which is a successor to Firm 1.No regulatory history.

Background
N/A
Sponsoring Firm

NASD member since 1991. Interdealer broker of corporate debt, US Govt securities, mortgage-backed secs, and emerging market debt. 2 OSJs and no branches. Employs 20 registered principals, 150 RRs and 180 employees.  LOCs for trade reporting.  Firm does not employ any other SDs.

Proposed Activity

X to continue employment in Firmís home office as broker of corporate debt securities.  Compensation is salary and quarterly discretionary bonus.

Proposed Supervisor

Senior managing director in home office.  Has Series 7 and 24. GSP 1992. In industry since 1977. No regulatory history.

Member Regulation Recommendation

Permitted

Considerations

Disqualification occurred 18 years ago without recurrence.  16 year SD status industry association without incident.  Firm qualified to supervise SD.X will be supervised in accordance with 1986 NYSE conditions subject to the deletion of [bracketed] terms and revisions as noted:

UNDERTAKINGS

1.         Quarterly [regular] review of X's overall business activities by the Proposed Supervisor; 

2.         Quarterly [daily] review of X's trading activity.  This review will be evidenced by the Proposed Supervisor initialing a quarterly activity report; 

3.         Quarterly [regular] review of X's commission runs; 

4.         A quarterly [monthly] compliance review for compliance with regulatory procedures and Firm policies; 

5.         X will have no supervisory duties; and 

6.         Any personal accounts [must be maintained at current Firm] held by X or any of his immediate family members will be subject to a monthly compliance review.  Copies of confirmations and statements generated by any brokerage account will be sent directly to the Sponsoring Firm.

Citations
N/A
 
Sections
Enforcement Actions
 
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