by Howard Haykin

PRUCO SECURITIES BROKER.   In November 2016, the broker borrowed $5,000 from an elderly customer. The loan has not been repaid. Pruco learned about the loan and, in September 2017, discharged the broker for taking loans and accepting money from multiple clients without firm approval. Upon receiving Pruco’s Form U5, FINRA initiated an investigation that concluded in March 2019 with the broker agreeing to pay a $5K fine and serve a 3-month suspension to settle charges that he violated FINRA Rule 3240(a).  [FINRA Case #2017056094402]

MORGAN STANLEY BROKER.   In August 2016, while experiencing financial difficulties, the broker borrowed $30,000 from a longtime friend and MS customer. Funds for the loan were wired from the customer's brokerage account to an external bank account also belonging to the customer. The customer then wired the funds to the broker. To conceal the purpose of the customer's withdrawal from Morgan Stanley, the broker submitted a wire transfer form that inaccurately described the reason for the wire transfer as for a "Car Purchase."

In December 2016, the customer agreed to loan the broker additional funds, and another wire transfer form was submitted to the firm – this time with “Living Expenses” as the reason for the withdrawal. After the funds were wired the customer elected not to consummate the 2_^nd loan. At or around this time, Morgan Stanley learned about the initial $30,000 loan, whereupon it terminated the broker and reimbursed the customer.

FINRA initiated an investigation that concluded in March 2019 with the broker agreeing to serve a 4-month suspension to settle charges that she violated FINRA Rule 3240(a). No fine was issued in light of the broker’s financial status.  [FINRA Case #2017052985001]