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Broker suspended by FINRA after failing to disclose felony charges on timely basis

On Behalf of | Jan 10, 2023 | FINRA Compliance

A broker was suspended by the Financial Industry Regulatory Authority over allegations of failing to disclose felony charges against him on a timely basis, ThinkAdvisor reports.

John Matthew Underation consented to the penalty in signing FINRA’s letter of acceptance, waiver and consent, but did not admit or deny the authority’s findings.

Underation had been a registered representative and broker with McDonald Partners beginning in 2017 but was discharged by the firm in May 2022. On his Form U5 Uniform Termination Notice, the firm stated that he was statutorily disqualified. FINRA said that while associated with McDonald Partners in 2020, Underation was indicted by a grand jury for three felonies: aggravated vehicular assault, vehicular assault, and failure to stop after an accident. He received notice of the charges on October 1, 2020 but willfully failed to amend his Form U4 to disclose the felony charges against him within 30 days as required, according to the AWC letter.

He pleaded guilty to an amended charge of attempted vehicular assault in June 2021 while the charges of aggravated vehicular assault and failure to stop after an accident were dismissed.

According to FINRA, it was not until April 2022 that Underation amended his Form U4 to disclose the three felony charges and one felony guilty plea, about ten months after the deadline for disclosing the felony guilty plea and well over a year after the deadline for disclosing the felony charges.

Because of this, he was found to be in violation of Article V, Section 2(c) of FINRA’s By-Laws and FINRA Rule 1122, mandating that no members file incomplete or inaccurate information regarding membership or registration, and Rule 2010, requiring members to observe high standards of commercial honor and just and equitable principles of trade.

Underation was suspended from associating with any FINRA member in all capacities for six months and was fined $5,000.

FINRA’s Form U5 tracks, among other things, the employment history of registered representatives and the circumstances surrounding why a registered representee’s registration with a firm terminated. An inaccurate filing threatens your career in the financial services industry and may permanently put you at a disadvantage when seeking future opportunities.  If you are concerned that you may be, or if you already have been, terminated from your firm, or if you believe you have inaccurate information on your Form U5, we invite you to contact us at (888) 655-6002 or through our online contact form to schedule a free consultation.