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.
Aggrey took the Series 86 examination at a testing center, and prior to the commencement of the exam, represented electronically and in writing that he had reviewed and accepted the testing centerís Rules of Conduct, which provided, among other things, that he could not receive any form of assistance during the examination. During the examination, Aggrey took an unscheduled break, during which he left the testing room, went to his locker, and, in plain view of a test center employee, retrieved his self-prepared study notes that contained material relevant to the Series 86 examination. After testing center personnel confronted him, Aggrey returned the notes to his locker, returned to the testing room and completed the examination.
Jamaine Kwesi Aggrey : Fined $5,000; Suspended 2 years
Associated Person Bao was in possession of unauthorized study aids while taking the Investment Company and Variable Contracts Products Representative qualification (Series 6) exam. Bao agreed by electronic submission prior to the exam not to possess notes, formulas, study materials or electronic devices in the exam room or during restroom breaks; but during a restroom break, she accessed unauthorized study materials from her locker.
Charles Patrick DiDomenico AWC/2009021029612/October 2010
DiDomenico requested and received an answer key to a state long-term care continuing education (LTC CE) exam from employees at his member firm on two occasions. There is no evidence that DiDomenico distributed these answer keys to anyone else.
Charles Patrick DiDomenico: Fined $5,000; Suspended 5 business days
Jeffrey David Rosen (Principal) AWC/2009021029611/October 2010
Because certain states began requiring individuals to successfully complete a LTC CE course before selling long-term care insurance products to retail customers, Rosen created an answer key for a long-term care exam for one state and also instructed some of his direct reports to create answer keys for exams. Rosen distributed answer keys to the exams to firm employees and instructed his direct reports to obtain from and provide answer keys to other firm employees; the direct reports provided the answers to financial advisors at other firms and Rosen was aware that they had done so. Rosen failed to supervise his direct reports, in that certain registered individuals who reported to him created answer keys to LTC CE exams, obtained from, and provided answer keys to, other employees, provided the answers to financial advisors and Rosen was aware that they had done so.
Jeffrey David Rosen (Principal): Fined $10,000; Suspended 3 months in all capacities; Suspended 6 months in Principal capacity only
April N. Berkholder AWC/2009021029609/September 2010
Berkholder requested and received an answer key to a state long-term care continuing education (LTC CE) exam from another firm employee. Berkholder asked an external wholesaler for the test and answers to the exam, which he sent to her via email.
April N. Berkholder: Fined $5,000; Suspended 5 business days
Jonathan Ross Davidson AWC/2009021029610/September 2010
Davidson requested and received answer keys for state insurance LTC CE exams for several states from member firm employees who created them and then distributed them to another firm employee and financial advisors outside the firm. Davidson asked his internal wholesaler to provide him with the last four digits of the wholesalerís social security number so that he could take one stateís LTC CE online exam and use the information to satisfy the online requirement of having someone proctor the exam. Davidson used the partial social security number to log in and access the exam, but did not complete the exam, but, in so doing, misrepresented having a proctor for the exam.
Jonathan Ross Davidson : Fiend $5,000; Suspended 45 days
Nathan Joel Brenowitz (Principal) AWC/2008013450201/September 2010
falsified a clientís insurance policy application and related documents without the clientís knowledge, submitted the documents to his member firmís insurance company affiliate and subsequently denied to his firm that he had falsified signatures or submitted falsely signed documents;
falsified clientsí insurance policy-related supplement documents without the clientsí knowledge, submitted the documents to his firmís insurance affiliate and, although the clients later stated that they approved of his actions, the firmís insurance affiliate policy prohibited its insurance agents from signing another personís name, even if the clientsí authorized them;
falsely endorsed and deposited a check for $1,000 made payable to an insurance agent contracted to him into his personal bank account, and falsely claimed to his firm that the insurance agent authorized him to use the check to repay expenses;
took an online computer examination on his office managerís behalf that his firmís insurance company affiliate required, and Brenowitz falsely denied to his firm that he did so;
denied in writing to FINRA that he took any test posing as his office manager; and
denied in sworn testimony to FINRA that he took any test posing as his office manager and claimed that the insurance agent contracted to him had authorized him to endorse and deposit the check and use the proceeds for expense reimbursement.
Jason Thomas Plunkett AWC/2009021029605/August 2010
Plunkett requested and/or received different answer keys for a state insurance LTC CE examination from firm employees who created them and Plunkett then distributed one of the answer keys to financial advisors outside of the firm.
Jason Thomas Plunkett : Fined $5,000; Suspended 1 month
Eric Spencer Cott (Supervisor) AWC/2009021029701/July 2010
Cott allowed another individual to improperly assist him in completing a Florida long-term care (LTC) continuing education (CE) requirement by taking the majority of an LTC CE exam for him. Cott obtained the Florida LTC CE requirement and then sold a universal life insurance policy with LTC benefits to a client.
Eric Spencer Cott (Supervisor): Fined $5,000; Suspended 1 month
In order to assist financial advisors taking their LTC CE state exams, Swisher created and distributed an answer key for one state exam, and received and distributed an answer key for another state exam .
Jill Meredith Swisher : Fined $5,000; Suspended 60 days
While sitting for the General Securities Representative qualification (Series 7) examination, Associated Person Leu was found to be in possession of unauthorized materials during a restroom break. Leu failed to timely respond to FINRA requests for information.
Kristen Kimberly Leu : Fined $10,000; Suspended 2 years.
Walsh took an online state continuing education (CE) examination for financial advisors working for another FINRA member firm. The financial advisors provided their driverís license and social security numbers to Walsh, who used the information to log onto the examination Web site and take the exam for them. Walsh assisted other financial advisors to take the CE examination by sitting with them in their offices and providing assistance to complete the examination. Walsh possessed and distributed an answer key to a financial advisor and permitted the answer key to be distributed to other financial advisors. Walsh did not report his conduct to his member firm.
Daniel Walsh: Censured; Fined $5,000; Suspended 90 days
Donato distributed the answer key to a state long-term care continuing education exam, and provided part of his social security number to an individual so that the individual could satisfy a continuing education exam online requirement of having someone proctor the exam, even though Donato was not present when the individual signed on to take tine exam. Donato failed to respond to a FINRA request to provide testimony.
Jose Ricardo Santillan AWC/2008016181501/March 2010
Santillan removed information regarding a FINRA qualification examination from a testing site. He made handwritten notes, which included examination questions and potential answers, and removed them from the testing site. Santillan electronically confirmed his agreement to the rules of conduct and agreed to maintain the confidentiality of the examination materials, including the examination questions.
In a recent FINRA regulatory settlement, a Barclays research analyst got a job offer from an issuer he was covering. FINRA makes the case that the job offer posed a conflict and should have been disclosed to the employer. Fair enough -- I agree; however, when considering FINRA's charges against the analyst, I was reminded of a similar scenario involving... Read On