by Howard Haykin

WHAT WENT WRONG.    Between January and June 2017, the broker personated 6 Ameriprise customers during 8 telephone calls made to Ameriprise's customer service center. In some instances, the impersonations were carried out to facilitate the customers' wishes to transfer money out of Ameriprise in order to be managed by the broker’s new investment advisory firm.

Specifically, the calls were made to …

• request account numbers and deposit information for the customer;
• request that copies of deposited checks be sent to the customer;
• request paperwork regarding the liquidation of securities held by the customer;
• direct the liquidation of securities held in customers' accounts; or,
• direct the disbursement of proceeds from customers' accounts by check to the customer's home address, or by wire transfer to the customer's bank account.

While each impersonation was conducted to carry out transactions and requests that each of the 6 customers had authorized and wanted executed, only some of the customers were aware of, and had authorized, his impersonations.

According to the amended Form U5, Ameriprise made the discovery during an internal review that was conducted after the broker had left the firm. It was the filing that prompted FINRA to conduct its investigation.

FINANCIALISH TAKE AWAYS.    Some brokers refuse to listen to logic or reasoning when told that their favorite or preferred short cuts violates (or may lead to violations of) FINRA rules and regulations or firm policies.

That said, it's important to emphasize (for those brokers who do listen) that the expediency of short cuts often do not justify the costs to those who are caught, in terms of … (i) dollars (fines and legal fees); (ii) time (suspensions and time negotiating with FINRA); and, (iii) reputational damage (CRD disclosures).

There's no reason the broker in this case had to impersonate his customers. He could have, for example, accommodated (and accompanied) his customers on conference calls with the call center. After all, we're only talking about 8 calls over a 6-month period.

This case was reported in FINRA Disciplinary Actions for April 2019.

For further details, go to ...  FINRA Disciplinary Actions Online, and refer to Case #2017054932701 .