by Howard Haykin

A broker with 34 years’ experience – the last 23 with Cantella & Co. – and the holder of 2 principal licenses (Series 4 and 24), got caught using personal emails to discuss securities business with customers, an obvious violation of his member firm’s policies.

Cantella terminated (U5’d) the broker, citing him for ... “using personal email to conduct securities business, copying a supervisor's signature and submitting as original on another document, and used a previously submitted distribution request form as original by altering the dates.”

FINRA levied a $2.5K fine and a 45-day suspension, citing the broker for ... violating FINRA Rules 4511 (Books and Records) and 2010 with respect only to the broker’s his use of personal email – while it also referred to the broker’s (untruthful) annual compliance attestations.

FINRA FINDINGS.    From at least October 2014 through May 2017 (the "Relevant Period"), the broker exchanged approximately 80 emails discussing securities business with 15 customers using his personal Yahoo email address. [That computes to fewer than 3 personal emails per month.] In the emails, the broker sent and received account statements, recommended stocks, took orders, reported on account activity, and discussed the transfer of accounts.

The broker not only violated Cantella's WSPs by using unapproved email addresses to communicate with customers, but he failed to forward his personal emails to Cantella for review and retention. And, according to FINRA, the broker added ‘insult to injury’ by attesting to his understanding of the company’s policy on the annual compliance attestation forms [a ‘horrific sin’ in the regulator's eyes ].

This case was reported in FINRA Disciplinary Actions for September 2018.

For details on this case, go to ...  FINRA Disciplinary Actions Online, and refer to Case #x2017055260101.