The Financial Industry Regulatory Authority announced penalties against a former Raymond James & Associates broker in San Francisco after a review uncovered rules violations, reports AdvisorHub.
William J. Conn was fined $15,000 and suspended for three months, according to a letter of acceptance, waiver and consent.
FINRA said that between January 2020 and March 2021, Conn exercised discretion without prior written authorization in connection with 465 transactions in 12 accounts held by five Raymond James customers. The firm’s procedures prohibited discretionary transactions without written authority from the customer and prior approval from the firm. Even though Conn’s customers knew he was placing trades in their accounts, he did not have written authorization from them or permission from Raymond James to exercise discretion in the accounts, the letter said.
Conn was found to have violated FlNRA Rule 3260(b)a, which provides that no registered representative “shall exercise any discretionary power in a customer’s account” unless the customer has given prior written authorization and the representative’s member firm has accepted the account as discretionary.
FINRA also determined that Conn gifted one of the five Raymond James customers a total of $120,000 by making 12 deposits into her checking account, but he did not disclose these gifts to the firm. He also falsely stated on his annual questionnaire that he had not gifted any customer more than $100, the authority said. These actions violated FINRA Rule 2010, requiring high standards of commercial honor and just and equitable principles of trade in the conduct of business.
Conn did not admit or deny the allegations, but accepted and consented to the entry of FINRA’s findings.
Conn, who was a managing director at Raymond James, did not respond to a request for comment sent through LinkedIn. His lawyer, Jarrod Malone of Shumaker, Loop & Kendrick in Sarasota, Florida, declined to comment.
In August 2022, Raymond James filed a termination notice stating that Conn had been terminated “for failure to follow firm policies with respect to exercise of order discretion, and with respect to payments to client.”
Unauthorized trading occurs when there is trading in nondiscretionary accounts without a client’s knowledge, which can result in significant financial damage. At Lewitas Hyman, we represent clients nationwide who are the victims of unauthorized trading, breaches of fiduciary duty and other forms of financial advisor misconduct and securities fraud. If your financial adviser made trades without your consent, you may be able to pursue a lawsuit to recoup your losses. Contact us at (888) 655-6002 or email our team to learn more about how we can help.
