A former broker for Pruco Securities has been barred by the Financial Industry Regulatory Authority, Investment News reports.
In a letter of acceptance, waiver and consent, FINRA said the broker, Christopher Reynolds, had forged customers’ signatures on annuities documents in order to liquidate the annuities and purchase units of a registered index-linked annuity product. Reynolds, who was registered at Pruco from 2021 to 2023, was discharged by the firm over the allegations.
In its Form U5, Pruco said Reynolds “submitted non-genuine client signatures on multiple applications; with the intent to evade suitability review, failed to disclose transactions as replacements; and used his personal email address to transmit client documents.”
FINRA’s investigation found that between September 2021 and January 2023~ Reynolds forged the signatures of three customers on 11 documents, including documents concerning withdrawals or surrenders of annuities in violation of FINRA Rule 2010. By doing this, he was found to have caused Pruco to maintain inaccurate books and records, in violation of FINRA Rules 4511 and 2010.
Furthermore, FINRA said Reynolds recommended that four customers make annuity withdrawals or surrenders and reinvest the proceeds in a registered index-linked annuity without having a reasonable basis to believe those
transactions were in his customers’ best interests. This violated Rule 15/-1 of the Securities Exchange Act of 1934 (Regulation Best Interest) and violated FINRA Rule 2010.
Reynolds was also found to have used his personal email account and cell phone to exchange securities-related communications with firm customers, a violation of FINRA rules regarding record-keeping of client communications.
An attorney for plaintiffs, Scott Silver, said this is by no means an isolated case. “Variable annuities sales are growing in the rising interest rate environment, and we’re seeing more instances of clients being switched out of annuities when it‘s in the brokers best interest and not the investors,” said Silver. “That means classic cases of switching to generate fresh commissions for the advisor and surrender charges and fees for the clients.”
Lewitas Hyman routinely represents investors harmed when financial professionals and their firms engaged in misconduct that caused their clients investment losses. If you think your financial professional or firm engaged in misconduct that caused investment losses, contact the Chicago investor fraud attorneys of Lewitas Hyman to schedule a free consultation by calling (888) 655 6002 or through our online contact form.
