Enforcement Actions
Financial Industry Regulatory Authority (FINRA)
CASES OF NOTE
2010
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.
December 2010
Jennifer Veronica Himes
AWC/2008015411501/December 2010

Registered Sales Assistant Himes violated her member firmís policies and procedures when she facilitated day-to-day interactions between a registered representativeís customers and a non-FINRA regulated investment group outside of her firm that operated as a commodity pool. Himes failed to disclose these activities to her member firm even though firm policies and procedures required her to do so. Himes failed to use the firmís email system on numerous occasions when communicating regarding the firmís business and customers as her firm required to meet its requirements under Section 17(a) of the Securities Exchange Act of 1934 and SEC Rule 17a-4.

At another registered representativeís direction, Himes communicated with the commodity pool using non-firm email addresses and relayed messages from the representative that specifically advised customers not to use firm email addresses for communications regarding the commodity pool.

Himes engaged in this conduct to prevent the firm from detecting that she and the representative were involved with the commodity pool, causing the firm to fail to retain certain email communications relating to its business.

Jennifer Veronica Himes : Fined $5,000; Suspended 2 months
Tags:  Commodity Futures    Commodity Pool    Email     |    In: Cases of Note : FINRA
Bill Singer's Comment
A very tempting situation, the referring of BD clients to commodity pool operators. Frankly, I've probably gotten more queries from clients this year about how to best arrange for those referrals than in any year that I've been practicing law. Bottom line: it's a tricky and difficult undertaking.  Exercise great care and caution before sending a client over the wall.
Kelvin Shaw (
AWC/2008015411502/December 2010

Shaw violated his member firmís policies and procedures when he recommended that certain customers invest in a non-FINRA regulated investment group outside of his firm that operated as a commodity pool, and facilitated the day-to-day interactions between certain customers and the commodity pool without providing his firm with written notice. Shaw used, and directed others in his office to use, unapproved email addresses that prevented the firm from reviewing communications regarding his activities.

The commodity pool was exposed as a Ponzi scheme and most of Shawís firm customers lost a total of approximately $660,000 of their investments. Shaw failed to use the firmís email system on numerous occasions when communicating regarding firm business, and its customers and the firm relied on his compliance to meet its requirements under SEC Rule 17a-4. Shaw directed certain of his staff to communicate with the commodity pool using non-firm email addresses and advised customers not to use firm email addresses for communications regarding the commodity pool in order to prevent the firm from detecting his involvement in the commodity pool. In addition, Shaw caused his firm to fail to retain certain email communications related to its business.

Shaw failed to fully and completely respond to a FINRA request for documents and information.

Kelvin Shaw (: Barred
Tags:  Email    Ponzi    Commodity Pool     |    In: Cases of Note : FINRA
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