By Howard Haykin

Marc Ravenscroft agreed to be barred from the industry to settle FINRA charges that he submitted expense reports containing business-related credit card charges that had been cancelled and refunded to his credit card.

FINRA FINDINGS.    Ravenscroft had 19 years’ experience with 6 firms – the last 9-1/2 years with LPL Financial. From March 2012 through March 2016 (the "Relevant Period"), Ravenscroft charged to his Firm corporate credit card at least $16,299 in travel-related expenses which he later cancelled.

So, while those charges were partially or wholly refunded to his Firm credit card by the vendor, Ravenscroft requested and obtained reimbursement from the Firm for the charges. Yet he never advised the Firm that the charges had been credited back to his corporate credit card and, instead used the reimbursed monies to pay for his personal expenses that he charged to his Firm corporate credit card.

FINANCIALISH TAKE AWAYS.    On his LinkedIn page, Ravencroft claims that he served as SVP, SE Division Manager for LPL Financial, and was “responsible for management of Business Development team in Southeast Region for LPL Financial.” Prior to that, he supposedly served as Regional Sales Director for OneAmerica.

Considering those ‘lofty’ sales titles, it's likely that Ravenscroft submitted a large number of expense reports – which would have made it difficult for anyone to detect fraudulent expense items. And, the task of detecting fraud was all the more difficult given that his false expenditures averaged around $4,000 a year - not an enormous sum.

So, how might a firm have combatted Ravencroft's scheme? Perhaps by ... (i) having the firm’s accounts payable department receive all business credit card statements directly from the credit card agency; or, (ii) having firm personnel audit selected line items on credit card statements or expense reports (though the latter alternative seems way too labor-intensive). 

This case addressed in this article was reported in FINRA Disciplinary Actions for November 2017.

For details on this case, go to ...  FINRA Disciplinary Actions Online, and refer to Case #2016049759001.