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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.
July 2010
Robert Edward Groux Sr.
AWC/2008012755301/July 2010
Groux recommended to elderly customers that they invest approximately $300,000, which was 90 percent of their liquid net worth and 100 percent of their account value, in a basket of illiquid, risky alternate investments, including real estate investment trusts and equipment leasing partnerships. Groux did not have reasonable grounds for believing that the recommendation was suitable based upon the facts the customers disclosed as to their financial situation and needs.
Robert Edward Groux Sr.: No Fine in light of financial status; Suspended 15 business days
Tags:  Elderly    REIT     |    In: Cases of Note : FINRA
Bill Singer's Comment
Okay, I'm either getting really dyspeptic in my old age or I'm seriously missing something. You dump the elderly into "illiquid, risky" investments that are not suitable BUT you only get a 15 business day suspension?  I'm sure (or I'm hoping) that FINRA is aware of facts that it didn't disclose in its brief monthly digest but, c'mon folks, you really need to explain those facts in writing to the public and industry. This is just absurd without more detail.
April 2010
Roger Odell Hudspeth II
OS/2008012955302/April 2010
Hudspeth sold Real Estate Investment Trusts (REITs) to customers without being registered as a Series 7 General Securities Representative. Another representative served as the registered representative of record and executed the REIT application, notwithstanding the fact that Hudspeth, and not the representative, recommended and sold the REITs to the customers.
Roger Odell Hudspeth II: Fined $5,000; Suspended 30 days
Tags:  REIT     |    In: Cases of Note : FINRA
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