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Recent FINRA Actions

Below are some of the Florida brokers and firms fined, suspended, or otherwise sanctioned by FINRA in June 2011.

FIRMS SANCTIONED

Beta Capital Management, L.P. (CRD #38964, Miami, Florida) submitted a Letter of Acceptance, Waiver and Consent in which the firm was censured and fined $20,000. Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings that it issued inaccurate and incomplete confirmations for equity transactions. The findings stated that the firm failed on numerous occasions to provide written notification disclosing to its customers its correct capacity in the transaction. The findings also stated that the firm erroneously represented that it had acted in an agency capacity in each transaction, when, in fact, it had acted in a principal capacity in each transaction. The findings also included that the firm failed on numerous occasions to disclose the difference between the price to the customer and the firm's contemporaneous purchase or sale price, or the reported trade price, the price to the customer and the difference, if any, between the two prices. (FINRA Case #2008014401501)

Geoffrey Richards Securities Corp. (CRD #120007, Hypoluxo, Florida) submitted a Letter of Acceptance, Waiver and Consent in which the firm was censured and fined $25,000. Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings that it failed to preserve all of its business-related electronic communications. The findings stated that the firm attempted to preserve such communications by burning them to a non-rewriteable, non-erasable disc on a monthly basis, but the process was deficient because it did not result in all such communications being saved to the disc. The findings also stated that the firm did not identify this deficiency in its audit of its electronic communications preservation system. The findings also included that the firm, in contravention of its written supervisory procedures, permitted registered representatives to use outside or non-firm-sponsored email accounts to send and receive securities business-related emails. FINRA found that the firm's preservation process did not capture these emails that were sent to or from those accounts; therefore, the firm did not retain and review them. FINRA also found that the firm relied exclusively on electronic storage media to preserve its business-related electronic communications but did not retain a third party who had the access or ability to download information from its electronic storage media. (FINRA Case #2009015971101)

Individuals Barred or Suspended

Shanoa Adrianne Rose Akins (CRD #4552640, Associated Person, Sunrise, Florida) submitted a Letter of Acceptance, Waiver and Consent in which she was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, Akins consented to the described sanction and to the entry of findings that she misappropriated approximately $1.1 million from her member firm. The findings stated that Akins created false entries in the firm's books and records, ranging in amounts of $250 to $50,000, which caused the firm to pay her money to which she was not entitled. (FINRA Case #2011027093001)

Darren Joseph Dietrich (CRD #1814017, Registered Representative, Plant City, Florida) was barred from association with any FINRA member in any capacity. The sanction was based on findings that Dietrich failed to appear and testify at FINRA on-the-record interviews. The findings stated that Dietrich executed unauthorized transactions in the account of his member firm's customer when he sold and purchased shares without the customer's prior knowledge, authorization or consent. (FINRA Case #2009016660701)

Jeremy Kenneth Kelter (CRD #843565, Registered Principal, Lake Worth, Florida) submitted a Letter of Acceptance, Waiver and Consent in which he was fined $5,000 and suspended from association with any FINRA member in any capacity for three months. The fine must be paid pursuant to the installment payment plan as designated on the election of payment form either immediately upon Kelter's reassociation with a FINRA member firm following his suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. Without admitting or denying the findings, Kelter consented to the described sanctions and to the entry of findings that he sold fixed annuities to investors outside the scope of his employment with his member firm, for which he received compensation totaling approximately $69,000. The findings stated that Kelter never provided his firm with written notice of these sales.

Jorge Ivan Salgado (CRD #4395823, Registered Representative, Miami, Florida) submitted a Letter of Acceptance, Waiver and Consent in which he was fined $5,000 and suspended from association with any FINRA member in any capacity for 10 business days. The fine must be paid either immediately upon Salgado's reassociation with a FINRA member firm following his suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. Without admitting or denying the findings, Salgado consented to the described sanctions and to the entry of findings that he exercised discretion on transactions in the account of customers at his member firm, without the customers' written authorization and without his firm's acceptance of the account as discretionary.

The suspension was in effect from May 2, 2011, through May 13, 2011. (FINRA Case #2009018425601)

Robert Marcus Lane Jr. (CRD #1411773, Registered Principal, North Palm Beach, Florida) was named as a respondent in a FINRA complaint alleging that he engaged in fraudulent interpositioning by causing his member firm to purchase distressed bonds from a broker-dealer and immediately caused the firm to sell the bonds at a markup to an entity he owned and controlled. The complaint alleges that Lane then caused his firm to repurchase the same bonds from the entity, typically at a second markup, and immediately caused his firm to sell the bonds to a firm customer at a third undisclosed markup. The complaint also alleges that Lane did not disclose to the customers that his firm had repurchased the bonds from one of the entities; the customers paid undisclosed markups ranging from 6.45 percent to 40.93 percent. The complaint further alleges that the interpositioning resulted in a profit totaling more than $322,000 for his firm and the entities he owned and controlled; since he was the majority owner of the firm and the sole owner of the entities, he personally benefited from the excessive profits the undisclosed markups earned. In addition, the complaint alleges that Lane knew, or was reckless in not knowing, that his interpositioning scheme would result in increased costs and excessive and fraudulent prices being charged to the customers, and were material facts he should have disclosed to the customers. Moreover, the complaint alleges that Lane charged unfair and unreasonable prices and excessive markups, and sold the bonds at prices that were not fair, taking into consideration all relevant circumstances, including market conditions with respect to such security at the time of the transaction, the expense involved, the fact that the firm is entitled to a profit and the factors set forth in NASD Interpretative Material-2440. Furthermore, the complaint alleges that Lane failed to provide complete and timely responses to FINRA's request for information and documents. (FINRA Case #2007008204901)



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