The Financial Industry Regulatory Authority penalized a former broker with Fidelity Investments over unapproved social media posts, according to Advisor Hub.
Without admitting or denying the findings, Kevin N. Jenkins agreed to a 45-day suspension for rule violations that occurred from 2021 to 2023 while he was with Fidelity. FINRA said Jenkins participated in private securities transactions without notice to his firm and failed to provide notice to his firm that his involvement in an outside business activity exceeded his prior disclosure.
While associated with Fidelity, Jenkins controlled and operated a company that created and published content on social media. In June 2023, Fidelity filed a Form U5 reporting that Jenkins had voluntarily resigned while under internal review for “posting of unapproved financial-related content in his social media and using the name of an entity that also had not been approved.”
FINRA states that Jenkins allegedly published financial education content on social media that included discussions of finance, economics. “That content included discussions of personal finance, economics, and investments and, at times, included recommendations to buy or sell specific securities,” the FINRA order states. “In connection with his online business, Jenkins also offered a subscription service for individualized financial advice.”
According to a letter of acceptance, waiver and consent, Jenkins had approval to operate an outside financial education company but did not disclose to Fidelity that he was offering specific investment recommendations. At least one of Jenkins’ customers followed the advice on social media and made 75 trades worth roughly $5,000 in principal, according to FINRA.
In August 2022, Jenkins falsely attested on the firm’s annual compliance questionnaire that he was not involved in any private securities transactions and did not maintain any outside business activities.
“After the firm raised questions about his activities, in March 2023 Jenkins made a written disclosure to the firm about his online brand, but he did not disclose that it included making investment recommendations,” the order states.
Jenkins was found to have violated FINRA Rules 3270, 3280, and 2010.
FINRA Rule 3270 provides that “[n]o registered person may be an employee, independent contractor, sole proprietor, officer, director or partner of another person, or be compensated, or have the reasonable expectation of compensation, from any other person as a result of any business activity outside the scope of the relationship with his or
her member firm, unless he or she has provided prior written notice to the member, in such form as specified by the member.”
FINRA Rule 3280(a) states that “[n]o person associated with a member shall participate in any manner in a private securities transaction except in accordance with the requirements of this Rule.” FINRA Rule 3280(b) provides that “[p]rior to participating in any private securities transaction, an associated person shall provide written notice to the member with which he is associated describing in detail the proposed transaction and the person’s proposed role therein and stating whether he has received or may receive any selling compensation in connection with the transaction.”
Violations of FINRA Rules 3270 and 3280 are also violations of FINRA Rule 2010, which requires members and associated persons, in the conduct of their business, to “observe high standards of commercial honor and just and equitable principles of trade.
Jenkins did not immediately return a request for comment through LinkedIn.
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