Bad Brokers

According to FINRA, Thomas Jacob Ciolek was barred from association with any FINRA member in all capacities for refusing to appear for on-the-record testimony requested during a FINRA investigation.

The investigation was initiated after Ciolek's member firm terminated his registration via Form U5...

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According to FINRA, Thomas Jacob Ciolek was barred from association with any FINRA member in all capacities for refusing to appear for on-the-record testimony requested during a FINRA investigation.

The investigation was initiated after Ciolek's member firm terminated his registration via Form U5 for electronically signing account documents on behalf of customers in violation of the firm's document signature policy. This type of unauthorized signature is a serious compliance violation that can facilitate fraud and unauthorized transactions.

FINRA's request for testimony was essential to understanding the circumstances surrounding Ciolek's conduct, including how many documents he signed, which customers were affected, whether customers authorized the signatures, and whether any harm resulted. His refusal to appear for testimony prevented FINRA from fully investigating these matters.

Electronically signing documents on behalf of customers without proper authorization is a significant red flag that can indicate forgery, unauthorized trading, or other misconduct. Firms prohibit such conduct precisely because it undermines the integrity of account documentation and customer authorization processes.

Cooperation with regulatory investigations is mandatory for all registered persons. When individuals refuse to provide testimony, particularly regarding serious allegations like unauthorized signatures, they obstruct FINRA's investor protection mission and demonstrate unfitness for the industry.

The permanent bar protects investors from an individual who was terminated for policy violations involving customer documents and then refused to explain his conduct to regulators. This case reinforces that refusing to testify will result in permanent removal from the securities industry.

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According to FINRA, Allen Israel Hershberg was barred from association with any FINRA member in all capacities for failing to provide documents and information requested during a FINRA investigation.

The investigation originated from a Form U5 filed by Hershberg's member firm disclosing that it p...

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According to FINRA, Allen Israel Hershberg was barred from association with any FINRA member in all capacities for failing to provide documents and information requested during a FINRA investigation.

The investigation originated from a Form U5 filed by Hershberg's member firm disclosing that it permitted him to resign due to concerns regarding his unapproved outside real estate investments. The Form U5 also disclosed concerns regarding his recommendation of those same outside real estate investments to firm clients and others, including through limited liability companies he created.

Recommending unapproved outside investments to clients is a serious violation that can expose investors to unsuitable, fraudulent, or high-risk investments that have not been vetted by the firm. Creating LLCs to facilitate such investments suggests a potentially deliberate scheme to circumvent firm oversight and supervision.

FINRA's investigation sought to understand the nature of these investments, which clients were affected, what representations Hershberg made, and whether clients suffered losses. Hershberg's refusal to provide requested documents and information prevented FINRA from fully investigating these serious allegations and determining what action was needed to protect investors.

All registered persons must cooperate with regulatory investigations. Those who refuse to provide information, particularly regarding allegations of recommending undisclosed outside investments to clients, demonstrate they will not submit to regulatory accountability.

The permanent bar protects investors from an individual who allegedly recommended unapproved investments and then refused to provide information about those activities. This case reinforces that cooperation with investigations is mandatory and refusal results in permanent industry removal.

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According to FINRA, James Walter Kondrasuk was barred from association with any FINRA member in all capacities for refusing to produce information and documents requested during a FINRA investigation.

The investigation concerned an allegation that Kondrasuk sought to deposit a check in his broker...

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According to FINRA, James Walter Kondrasuk was barred from association with any FINRA member in all capacities for refusing to produce information and documents requested during a FINRA investigation.

The investigation concerned an allegation that Kondrasuk sought to deposit a check in his brokerage account with his member firm that was signed by him and drawn on a non-existent bank account purportedly in his name. Attempting to deposit a check drawn on a non-existent account is a serious allegation that could constitute fraud or an attempted fraud.

FINRA's investigation sought to understand the circumstances surrounding this check, including how Kondrasuk obtained it, why he attempted to deposit it, whether he knew the account did not exist, and whether this was an isolated incident or part of a pattern. Kondrasuk's refusal to provide requested information and documents prevented FINRA from fully investigating this potentially criminal conduct.

Financial fraud and attempted fraud have no place in the securities industry. Individuals who may have engaged in such conduct pose significant risks to investors and must be removed from positions of trust. Kondrasuk's refusal to provide information about this serious allegation suggests he had something to hide.

Cooperation with regulatory investigations is a fundamental obligation of all registered persons. Those who refuse to provide information about serious allegations like potential fraud demonstrate they are unwilling to be held accountable and are unfit for the securities industry.

The permanent bar protects investors from an individual who allegedly attempted to deposit a fraudulent check and then refused to explain his conduct to regulators.

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According to FINRA, Wilfredo Felix Jr. was barred from association with any FINRA member in all capacities following a National Adjudicatory Council decision upholding findings and sanctions imposed by the Office of Hearing Officers. The bar has been appealed to the SEC and is in effect pending revi...

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According to FINRA, Wilfredo Felix Jr. was barred from association with any FINRA member in all capacities following a National Adjudicatory Council decision upholding findings and sanctions imposed by the Office of Hearing Officers. The bar has been appealed to the SEC and is in effect pending review.

Felix failed to respond to multiple FINRA requests for information and documents. Refusing to respond to even a single request is a serious violation, but failing to respond to multiple requests demonstrates a persistent refusal to cooperate with regulatory oversight.

FINRA's ability to regulate the securities industry and protect investors depends on registered persons providing requested information and documents. When individuals repeatedly refuse to respond to requests, they obstruct FINRA's mission and demonstrate unfitness for the industry.

All FINRA-registered persons agree to cooperate with investigations and inquiries as a condition of registration. This obligation is not optional and applies regardless of the nature of the inquiry. Those who repeatedly fail to respond show they will not submit to the regulatory oversight necessary to protect investors.

The permanent bar, pending appeal, removes from the industry an individual who demonstrated through multiple failures to respond that he will not cooperate with regulatory authorities. This protects investors from someone who refused to be held accountable.

This case reinforces that cooperation with FINRA requests is mandatory and repeated failures to respond will result in permanent removal from the industry. Registered persons must understand that regulatory oversight is a condition of the privilege to serve investors.

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According to FINRA, Raymi Nodarse Valdes was barred from association with any FINRA member in all capacities for refusing to provide on-the-record testimony requested during a FINRA investigation.

The investigation concerned Nodarse Valdes' alleged undisclosed participation in private securities ...

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According to FINRA, Raymi Nodarse Valdes was barred from association with any FINRA member in all capacities for refusing to provide on-the-record testimony requested during a FINRA investigation.

The investigation concerned Nodarse Valdes' alleged undisclosed participation in private securities transactions, commonly known as "selling away." Private securities transactions are securities transactions conducted by a registered person outside the scope of their employment with their firm. These transactions are prohibited unless the registered person provides prior written notice to their firm and, if they will receive compensation, obtains the firm's written approval.

Selling away is a serious violation because it deprives investors of important protections. When registered persons conduct securities transactions outside their firm's supervision, the firm cannot supervise those transactions, verify their suitability, or address problems that arise. Investors are left without the protections of firm oversight and may have limited recourse if they suffer losses.

FINRA's request for testimony was essential to investigating whether Nodarse Valdes engaged in private securities transactions, which customers were involved, what products were sold, and whether customers were harmed. Her refusal to provide testimony prevented FINRA from fully investigating these allegations.

All registered persons must cooperate with investigations. Those who refuse to testify about serious allegations like selling away demonstrate unwillingness to be held accountable and are unfit for the industry.

The permanent bar protects investors from an individual who allegedly engaged in undisclosed private securities transactions and then refused to explain her conduct to regulators.

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According to FINRA, Nancy Kimball Mellon was barred from association with any FINRA member in all capacities following a National Adjudicatory Council decision upholding findings and sanctions imposed by the Office of Hearing Officers.

Mellon converted $4,300 from her member firm, including $2,80...

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According to FINRA, Nancy Kimball Mellon was barred from association with any FINRA member in all capacities following a National Adjudicatory Council decision upholding findings and sanctions imposed by the Office of Hearing Officers.

Mellon converted $4,300 from her member firm, including $2,800 from her Financial Advisor Expense Management System account and $1,500 from a system for expense reimbursement. She falsified expense reports by directing her assistant to enter four false reports claiming she paid $3,800 to a college football bowl game when she had not. Mellon used a dishonored check as evidence of payment despite knowing it had not cleared, and sought reimbursement of $500 more than the invoice amount. By submitting false expense reports, Mellon caused the firm to maintain inaccurate books and records.

Most egregiously, Mellon provided false and misleading information to FINRA during its investigation. She purposefully took steps to prevent production of bank statements requested by FINRA, requesting that her bank provide a letter denying production. Mellon falsely responded that statements were unavailable and claimed the invoice was not paid by check. FINRA gave multiple opportunities to correct her misrepresentations, but she continued falsely claiming she could not access bank statements. She provided a partial email communication with her bank, taken out of context, to mislead FINRA. The bank confirmed it would provide statements if requested, but Mellon had not asked. She knew producing statements would reveal she had not paid the invoice before the firm reimbursed her.

Conversion of firm funds and falsifying expense reports are serious violations, but providing false information to obstruct an investigation is particularly egregious. The permanent bar protects investors from an individual who stole from her firm, falsified records, and then lied to cover it up.

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According to FINRA, Edward L. Turley was barred from association with any FINRA member in all capacities for refusing to provide on-the-record testimony requested during a FINRA investigation.

The investigation originated from FINRA's review of a customer-initiated arbitration. The request for te...

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According to FINRA, Edward L. Turley was barred from association with any FINRA member in all capacities for refusing to provide on-the-record testimony requested during a FINRA investigation.

The investigation originated from FINRA's review of a customer-initiated arbitration. The request for testimony related to Turley's trading in customer accounts, including use of foreign currency and margin, and the purchasing and selling of high-yield bonds and preferred stock.

These are significant matters involving potentially complex and risky investment strategies. Foreign currency trading and margin use can amplify losses and may not be suitable for all investors. High-yield bonds carry increased credit risk. Understanding Turley's recommendations, the basis for those recommendations, and whether they were suitable for the affected customers was essential to FINRA's investigation.

Customer arbitrations often raise important questions about sales practices and suitability. When FINRA investigates matters arising from arbitrations, it seeks to determine whether violations occurred, whether other customers may have been affected, and what corrective action is needed. Turley's refusal to testify prevented FINRA from fully investigating these matters and determining appropriate action.

All registered persons must cooperate with investigations. Those who refuse to provide testimony about their trading practices and recommendations demonstrate they are unwilling to be held accountable for their conduct with customer accounts.

The permanent bar protects investors from an individual who was the subject of customer arbitration allegations and then refused to explain his trading practices and recommendations to regulators. This case reinforces that refusing to testify results in permanent industry removal.

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According to FINRA, Justin Allen Anderson was barred from association with any FINRA member in all capacities for refusing to appear for on-the-record testimony requested during a FINRA investigation.

The investigation originated after FINRA received a Form U5 from Anderson's member firm disclosi...

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According to FINRA, Justin Allen Anderson was barred from association with any FINRA member in all capacities for refusing to appear for on-the-record testimony requested during a FINRA investigation.

The investigation originated after FINRA received a Form U5 from Anderson's member firm disclosing that he was under internal review for client signature discrepancies on account documentation. Signature discrepancies on account documents are a serious red flag that may indicate forgery, unauthorized signatures, or falsified documentation.

Account documents with authentic customer signatures are fundamental to protecting both customers and firms. These documents establish customer authorization for account opening, investment decisions, and transactions. When signatures are discrepant or potentially forged, it raises serious questions about whether customers authorized the actions taken in their accounts and whether fraud occurred.

FINRA's request for testimony was essential to understanding what happened, including how many documents had signature discrepancies, which customers were affected, whether Anderson forged signatures, whether customers were aware of and authorized the documents, and whether any harm resulted. Anderson's refusal to appear for testimony prevented FINRA from fully investigating these serious allegations.

All registered persons must cooperate with regulatory investigations. Those who refuse to testify about serious allegations like signature discrepancies demonstrate they will not submit to regulatory accountability and are unfit for the industry.

The permanent bar protects investors from an individual who was under internal review for signature discrepancies and then refused to explain his conduct to regulators. This case reinforces that cooperation is mandatory and refusal results in permanent removal from the industry.

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According to FINRA, Brandon Self was barred from association with any FINRA member in all capacities for refusing to provide information and documents requested during a FINRA investigation.

The investigation was initiated after the Certified Financial Planner Board of Standards, Inc. (CFP Board)...

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According to FINRA, Brandon Self was barred from association with any FINRA member in all capacities for refusing to provide information and documents requested during a FINRA investigation.

The investigation was initiated after the Certified Financial Planner Board of Standards, Inc. (CFP Board) issued an administrative order permanently barring Self from applying for or obtaining the CFP certification marks. The CFP Board's sanction followed Self's failure to file an answer to a complaint alleging that he engaged in exam misconduct in connection with the CFP Exam.

Exam misconduct in connection with professional certification examinations is a serious matter that calls into question an individual's integrity and fitness for the financial services industry. The CFP designation is held out to the public as indicating adherence to high ethical standards and professional competence. Alleged exam misconduct undermines the integrity of the certification process.

FINRA's investigation sought to understand the circumstances surrounding the CFP Board's action and Self's fitness to remain registered. Self's refusal to provide requested information and documents prevented FINRA from fully investigating these matters and making an informed determination about appropriate action.

All registered persons must cooperate with regulatory investigations. When other regulators take action against a registered person, FINRA has a responsibility to investigate and determine what action may be necessary to protect investors. Those who refuse to provide information about such matters demonstrate unfitness for the industry.

The permanent bar protects investors from an individual who was permanently barred by the CFP Board for alleged exam misconduct and then refused to provide information to FINRA about these serious matters.

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According to FINRA, Cathie Ann Joughin was barred from association with any FINRA member in all capacities for refusing to provide information and documents requested during a FINRA investigation.

The investigation concerned a Form U5 filed by Joughin's member firm stating that she had resigned w...

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According to FINRA, Cathie Ann Joughin was barred from association with any FINRA member in all capacities for refusing to provide information and documents requested during a FINRA investigation.

The investigation concerned a Form U5 filed by Joughin's member firm stating that she had resigned while under review for compliance policy violations related to a fiduciary relationship. Fiduciary relationships impose the highest duty of loyalty and care. When securities professionals serve as fiduciaries for customers, they must act in the customer's best interest and avoid conflicts of interest.

Compliance policy violations related to a fiduciary relationship could involve self-dealing, conflicts of interest, misuse of customer assets, or failure to properly disclose the fiduciary relationship to the firm. Such violations are serious because they involve breach of trust and potentially misuse of a position of confidence.

FINRA's investigation sought to understand the nature of the fiduciary relationship, what compliance policy violations occurred, whether customers were harmed, and what corrective action was needed. Joughin's refusal to provide requested information and documents prevented FINRA from fully investigating these serious matters.

All registered persons must cooperate with regulatory investigations. Those who resign while under review and then refuse to provide information about the matters under investigation demonstrate they will not be held accountable and are unfit for the industry.

The permanent bar protects investors from an individual who allegedly violated policies related to a fiduciary relationship and then refused to explain her conduct to regulators. This case reinforces that cooperation with investigations is mandatory and refusal results in permanent removal from the industry.

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