Articles Posted in Disciplinary Actions

Bob Simons suspended over discretionary trading

In June, 2016 FINRA suspended International Assets Advisory broker Bob Simons for 45 days and fined him $5,000 over allegations that Simons used a private email account to conduct firm business and exercised  discretion in customer accounts without complying with firm protocol for doing so. Simons consented to the findings without admitting or denying them, and agreed to the suspension and fine.

Simons, of Brooklyn, Connecticut was affiliated with International Assets Advisory from October, 2014 to May, 2016.  Prior to that he was affiliated with Center Street Securities from September, 2011 to August, 2014.  Before that he was with NY Life Securities.

Todd Pilosi, a registered representative from Clovis, California, formerly with LPL Financial was suspended from FINRA membership as a result of an investigation into his borrowing money from a customer without obtaining firm approval, which is a violation of LPL and FINRA rules.   Pilosi entered into an acceptance waiver and consent agreement with FINRA in which he neither admitted nor denied the findings, but agreed to a suspension of four months and a fine of $5,000.

In June, 2017 Todd Pilosi agreed to the suspension and FINRA published its findings that Pilosi borrowed $150,000 from a customer, which has not been paid back.  Pilosi has entered into a settlement agreement with the customer.  FIRNA also found that Pilosi misled LPL when he submitted a compliance questionnaire in which he denied engaging in the loan transaction with the customer.

Todd Pilosi’s registration and disciplinary history

John Olinghouse, a registered representative from Sparks, Nevada, formerly with HD Vest and Fortune Financial Services was suspended from FINRA membership as a result of an investigation into his reusing customer signatures by affixing them to different documents.  Olinghouse entered into an acceptance waiver and consent agreement with FINRA in which he neither admitted nor denied the findings, but agreed to a suspension of one year and a fine of $15,000.

In June, 2017 John Olinghouse agreed to the suspension and FINRA published its findings that Olinghouse used whiteout  and cutouts of client signatures on broker dealer documents and settled a customer complaint without notifying the firm.

John Olinghouse’s registration and disciplinary history

Clay Hoffman, a registered representative from Brunswick, Georgia, formerly with Summit Brokerage Services and Suntrust Investment Services was barred from FINRA membership as a result of failing to cooperate with a FINRA investigation. Hoffman has a long list of customer disputes (14) as well as being the subject of regulators’ investigations on four occasions.  See below.

FINRA Rule 9552. Failure to Provide Information or Keep Information Current

This FINRA rule provides if a FINRA member fails to provide information or testimony requested or required by FINRA’s By-Laws or FINRA rules, or fails to keep his or her membership and supporting documents current, FINRA, after providing  21 days’ notice may suspend the FINRA membership of the person. If the suspension is not challenged within 90 days, FINRA may bar the individual.

Ronald Broadstone, a registered representative from Columbus, Ohio, formerly with UBS Financial Services was barred from FINRA membership as a result of failing to cooperate with a FINRA investigation.

FINRA Rule 9552. Failure to Provide Information or Keep Information Current

This FINRA rule provides if a FINRA member fails to provide information or testimony requested or required by FINRA’s By-Laws or FINRA rules, or fails to keep his or her membership and supporting documents current, FINRA, after providing  21 days’ notice may suspend the FINRA membership of the person. If the suspension is not challenged within 90 days, FINRA may bar the individual.

BOK Financial Settles SEC claims over Christopher Brogdon Senior Housing Deals

On September 9, 2016 the SEC announced a settlement with BOK Financial Corporation whereby the firm agreed to pay $1.6 million to settle allegations that it failed to disclose a number of problems and concerns with several Christopher Brogdon municipal bond offerings.

The SEC contended that Bok Financial was aware of numerous red flags related to the offerings, such as the fact that Brogdon was withdrawing money from the bond offering reserve funds, and not filing annual financial statements for the offerings.  The SEC charged Brogdon with fraud and he has since agreed to repay over eighty million dollars to investors.

The SEC charged South Carolina resident Dwayne Edwards with fraud for his role in a $62 million assisted living municipal bond offering.

On January 10, 2017 the SEC charged South Carolina business man Dwayne Edwards with fraud in connection with a series of municipal bond offerings that raised funds for assisted living centers across the south, in Georgia and Alabama.

Edwards was charged with comingling funds, diverting funds and improperly using funds which were raised to purchase and renovate the adult car facilities.

The SEC charged former J.D. Nicholas broker Don Fowler with violating the securities laws for churning customer accounts.

On January 10, 2017 the SEC charged Don Fowler of Massapequa, N.Y. a registered representative with Worden Capital Management, and previously with J.D. Nicholas & Associates (f/k/a  A & F Financial Securities) with excessively trading customer accounts for the purpose of generating commissions.

This type of conduct, if proven, is typically referred to as churning, and is a violation of the securities laws.   The SEC alleges that Fowler failed to act for the benefit of his customers, and instead pursued a strategy designed to generate excess commissions at his customers’ expense.  The SEC has charged Fowler with violations of Section 17(a) of the Securities Act as well as Section 10(b)(5) of the Exchange Act.

Worden Capital’s Greg Dean charged by SEC with churning customer accounts.

On January 10, 2017 the SEC charged Greg Dean of Seaford, N.Y. a registered representative with Worden Capital Management, and previously with J.D. Nicholas & Associates with excessively trading customer accounts for the purpose of generating commissions.

This type of conduct, if proven, is typically referred to as churning, and is a violation of the securities laws.   The SEC alleges that Dean failed to act for the benefit of his customers, and instead pursued a strategy designed to generate excess commissions at his customers’ expense.  The SEC has charged Dean with violations of Section 17(a) of the Securities Act as well as Section 10(b)(5) of the Exchange Act.

FINRA charges Rusty Tweed over fund transactions.

On April 27, 2017 FINRA charged Rusty Tweed of Glendale California, a registered representative with Cabot Lodge Securities and formerly with Concorde Investment Services with making misstatements to investors in connection with a private placement in a company that utilized a computerized trading strategy.  FINRA alleges that Tweed’s conduct violated section 17 of the Securities Act of 1933.

FINRA’s complaint alleges that Tweed received over one and a half million dollars from his broker dealer clients using a false and misleading private placement memorandum.  The transaction involved an investment fund controlled by Tweed that utilized computerized trading  to make profits from the stock market.