BD President/CCO Fined and Barred for Helping Brother-in-Law
The SEC barred and fined the President/CCO of a broker-dealer for allowing his suspended brother-in-law to service clients. The suspended broker encouraged his former clients to move their accounts to his family’s BD, upon approval from his father, the firm’s chairman. Although the BD could not register him as a representative, the President/CCO allowed him to open new accounts, access trading systems, and, ultimately, make unauthorized trades in leveraged ETFs. The SEC also notes that the suspended broker violated the compliance policies and procedures that the respondent was obligated to enforce as CCO.
We appreciate trying to maintain cordial familial relationships (especially with your father-in-law and brother-in-law), but standing by and allowing blatant securities laws violations goes beyond “family first.” Both the SEC and FINRA do not appreciate attempted end-runs around industry suspensions and bars.