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.

Prakash Devendranath Simha
AWC/2009020863401

Simha borrowed approximately $51,000 from customers at his member firm in order to complete renovations on his house.

The loans were not reduced to writing and had no repayment terms; the customers had been Simha’s friends for many years, and one was his relative. The firm had a policy prohibiting representatives from borrowing money from customers; one of the loans was repaid before Simha disclosed it to the firm and the other loans have since been forgiven by the customers.

Simha sent an email to a former customer requesting a share of the profits that were made in the customer’s account while the account was with the firm. In that email, Simha represented that FINRA was auditing the customer’s account, but this was not correct; the client never sent Simha the share of the profits he requested.

Prakash Devendranath Simha : Fined $7,500; Suspended 30 business days

Tags: Borrowing  Sharing Profits