Bad Brokers

According to FINRA, three individuals were barred from association with any FINRA member pursuant to FINRA Rule 9552(h) for failing to provide information or keep information current:

Jeu Emmanuel Delgado Lopez of Fontana, California (CRD #7505213) was barred effective April 28, 2025.

Jerome O...

Read More

According to FINRA, three individuals were barred from association with any FINRA member pursuant to FINRA Rule 9552(h) for failing to provide information or keep information current:

Jeu Emmanuel Delgado Lopez of Fontana, California (CRD #7505213) was barred effective April 28, 2025.

Jerome Oliver Harris of Kansas City, Missouri (CRD #5551156) was barred effective April 28, 2025.

Thomas Christopher Johnson of Lancaster, Texas (CRD #7509093) was barred effective April 28, 2025.

A bar under Rule 9552(h) occurs when an individual fails to respond to FINRA information requests and the suspension under Rule 9552(d) has converted to a bar. This typically happens when an individual is suspended for non-response and then fails to respond for an extended period, resulting in a permanent bar.

These bars are not findings of substantive misconduct—they are sanctions for failing to cooperate with FINRA's regulatory authority. However, when individuals refuse to provide information requested in investigations, it often suggests concerns about what that information might reveal.

The underlying investigations that prompted these information requests are not described in the public notice. Investors who worked with any of these individuals may want to review their accounts carefully, as the failure to cooperate may relate to potential misconduct affecting customers.

Individuals who are barred cannot work in any capacity with a FINRA member firm. Investors can verify current registration status and view regulatory history through FINRA BrokerCheck.

Show Less

According to FINRA, several individuals were suspended from association with any FINRA member pursuant to FINRA Rule 9552(d) for failing to provide information or keep information current:

Kwabena Adusei of Charlotte, North Carolina was suspended effective April 3, 2025.

Rezwan Mohammed Alam o...

Read More

According to FINRA, several individuals were suspended from association with any FINRA member pursuant to FINRA Rule 9552(d) for failing to provide information or keep information current:

Kwabena Adusei of Charlotte, North Carolina was suspended effective April 3, 2025.

Rezwan Mohammed Alam of Parkland, Florida was suspended effective April 3, 2025.

Cody M. Anderson of Buffalo, New York was suspended effective April 25, 2025.

Courtney Rae Buth of Moorhead, Minnesota was suspended effective April 17, 2025.

Jesus Gabriel Cantu of Kyle, Texas was suspended effective April 21, 2025.

Stacey Joy Chen of New York, New York was suspended effective April 28, 2025.

Bennett Knapp Ely of West Des Moines, Iowa was suspended effective April 3, 2025.

Howard O'Keefe Graham of Madison, Mississippi was suspended effective April 7, 2025.

Rebecca Katherine Hart of Strasburg, Virginia was suspended effective April 28, 2025.

Jennifer Marie Kuntzman of Florissant, Missouri was suspended effective April 28, 2025.

Jason J. Ratkovich of Aliquippa, Pennsylvania was suspended effective April 21, 2025.

These suspensions remain in effect until the individuals provide the requested information. If they continue to fail to respond, these suspensions may convert to permanent bars.

Investors who worked with any of these individuals should be aware they are currently suspended from the securities industry. If you have accounts or investments with these individuals, you may want to review your accounts and consider whether any action is needed to protect your interests.

Show Less

According to FINRA, several individuals were suspended pursuant to FINRA Rule Series 9554 for failing to comply with arbitration awards, settlements, or orders of restitution:

James Burchett Cross of Bozeman, Montana was suspended from February 5, 2025, through April 1, 2025, in connection with F...

Read More

According to FINRA, several individuals were suspended pursuant to FINRA Rule Series 9554 for failing to comply with arbitration awards, settlements, or orders of restitution:

James Burchett Cross of Bozeman, Montana was suspended from February 5, 2025, through April 1, 2025, in connection with FINRA Arbitration Case #24-01744. His suspension has been lifted.

Joshua Nathan Helmle of Oceanside, California was suspended effective April 3, 2025, in connection with FINRA Arbitration Case #24-00004.

John W. Nelson of Akron, Ohio was suspended effective April 10, 2025, in connection with FINRA Arbitration Case #24-02320.

Kevin F. Shipley of Orlando, Florida was suspended effective April 28, 2025, in connection with FINRA Arbitration Case #24-02227.

When customers win arbitration awards or reach settlements with brokers and those brokers fail to pay, FINRA can suspend the broker's registration until the award is satisfied. This mechanism helps ensure that customers can collect what they are owed.

For investors who have unpaid arbitration awards, FINRA Rule 9554 provides a means of enforcement. The threat of losing the ability to work in the securities industry often motivates payment.

Investors with arbitration awards against these individuals should note their suspension status. For Cross, whose suspension has been lifted, this suggests the underlying award or settlement may have been satisfied. For the others, their continued suspension indicates the obligations remain outstanding.

If you have a judgment against a suspended individual, you may want to consult with an attorney about collection options, as FINRA suspension is just one enforcement mechanism available.

Show Less

According to FINRA, IBN Financial Services, Inc. and Timothy Edward Evans have been sanctioned for failing to reasonably supervise a registered representative's recommendations of alternative investments to retail customers.

The firm was censured, fined $50,000, and required to certify remediatio...

Read More

According to FINRA, IBN Financial Services, Inc. and Timothy Edward Evans have been sanctioned for failing to reasonably supervise a registered representative's recommendations of alternative investments to retail customers.

The firm was censured, fined $50,000, and required to certify remediation of the identified issues. Evans was fined $5,000, suspended for one month from any principal capacity, and required to complete 20 hours of continuing education concerning Regulation Best Interest (Reg BI).

The violations centered on the firm and Evans approving unsuitable sales of speculative alternative investments, including non-traded REITs, to two retail customers despite clear red flags. One customer, a 71-year-old retiree with moderate risk tolerance, ended up with a 47% concentration in speculative alternative investments after purchasing $400,000 worth of illiquid products. A second customer with only $25,000 annual income became 77% concentrated in speculative alternative investments.

Despite obvious warning signs that these recommendations were not suitable or in the customers' best interests, the firm and Evans failed to conduct additional review or take steps to evaluate whether the representative had good cause for the recommendations given the excessive concentration levels.

Investors should understand that Reg BI requires broker-dealers to act in their best interest when making recommendations. This case demonstrates the importance of questioning recommendations that result in heavy concentrations in speculative, illiquid investments, especially for retirees or those with limited income.

Show Less

According to FINRA, BofA Securities, Inc. has been censured and fined $250,000 for failing to timely and accurately report transactions to the Trade Reporting and Compliance Engine (TRACE).

The findings revealed that the firm failed to timely report agency debt transactions, transactions in secur...

Read More

According to FINRA, BofA Securities, Inc. has been censured and fined $250,000 for failing to timely and accurately report transactions to the Trade Reporting and Compliance Engine (TRACE).

The findings revealed that the firm failed to timely report agency debt transactions, transactions in securitized products, and corporate debt transactions. Additionally, the firm inaccurately reported transactions without required modifiers and failed to establish and maintain systems reasonably designed to achieve compliance with TRACE reporting obligations.

TRACE is a FINRA-developed system that brings transparency to the bond market by requiring firms to report bond transactions. When firms fail to report timely and accurately, it undermines market transparency and can harm investors who rely on this data for pricing information.

The firm's system for reviewing late TRACE reports was not reasonably designed to take appropriate corrective action or identify inaccuracies. Since the violations were discovered, BofA Securities has migrated to a new internal reporting system and implemented new exception reports and management meetings to review compliance.

For investors, this case highlights the regulatory infrastructure that exists to ensure market transparency. While reporting failures may seem technical, they can impact the pricing and liquidity information available to investors in the bond market.

Show Less

According to FINRA, International Assets Advisory, LLC has been censured and fined $20,000 for failing to properly report transactions in TRACE-eligible securities and municipal securities.

The firm failed to report approximately 290 back-to-back principal transactions in TRACE-eligible securitie...

Read More

According to FINRA, International Assets Advisory, LLC has been censured and fined $20,000 for failing to properly report transactions in TRACE-eligible securities and municipal securities.

The firm failed to report approximately 290 back-to-back principal transactions in TRACE-eligible securities, only reporting trades with other broker-dealers while failing to report the offsetting step-out transactions for a customer who was an independent investment adviser.

Similarly, in approximately 270 back-to-back principal transactions in municipal securities, the firm only reported trades to the MSRB's Real-time Transaction Reporting System (RTRS) without reporting the customer side of the transactions. The firm also reported approximately 40 municipal securities transactions that should not have been reported because the transactions were canceled.

These reporting requirements exist to provide transparency in the bond markets. When firms fail to report all sides of transactions, it can create incomplete pictures of market activity and potentially mislead other market participants about actual trading volumes and prices.

The firm has since begun properly reporting both sides of step-out transactions to TRACE and RTRS as required. Investors should understand that regulatory oversight of trade reporting helps maintain fair and transparent markets for fixed-income securities.

Show Less

According to FINRA, CIM Securities, LLC has been censured and fined $70,000 for selling an offering for which no exemption from registration was available, effectively conducting an unregistered distribution of securities.

The firm acted as a placement agent for a private placement offering where...

Read More

According to FINRA, CIM Securities, LLC has been censured and fined $70,000 for selling an offering for which no exemption from registration was available, effectively conducting an unregistered distribution of securities.

The firm acted as a placement agent for a private placement offering where the issuer engaged in general solicitation by issuing press releases about the offering. More concerning, the firm's dealings involved a covered person who had been convicted of wire fraud and money laundering and was subsequently barred by the SEC. This individual misled the firm about his identity by providing identity verification documents that did not match his name or age.

Despite these red flags, the firm failed to reasonably respond and relied on the covered person's representations. The required disclosures about this individual's criminal history were never provided to investors as required by Rule 506(e).

Additionally, the firm's written supervisory procedures did not provide reasonable guidance on adequate due diligence for private placements, and the firm distributed investor materials that violated FINRA Rule 2210's content standards by failing to disclose specific risks and making misleading claims about profitability and liquidity.

This case illustrates the importance of thorough due diligence in private placements. Investors considering private offerings should ensure they receive all required disclosures and understand the backgrounds of those involved in the offering.

Show Less

According to FINRA, The Frazer Lanier Company, Incorporated has been censured, fined $125,000, and required to certify remediation for failing to establish and maintain supervisory systems designed to achieve compliance with MSRB Rule G-37.

The firm's written supervisory procedures required emplo...

Read More

According to FINRA, The Frazer Lanier Company, Incorporated has been censured, fined $125,000, and required to certify remediation for failing to establish and maintain supervisory systems designed to achieve compliance with MSRB Rule G-37.

The firm's written supervisory procedures required employees to disclose political contributions but did not specify when disclosures had to be made or how supervisors should review them. The firm had no system to aggregate employee political contributions or track donations to specific candidates during primary or general elections.

Critically, the firm failed to detect that a $500 political contribution from a municipal finance professional, which was reported as two separate $250 contributions from a joint checking account, actually exceeded the de minimis exception under MSRB Rule G-37(b).

The firm was also a dues-paying member of a non-profit organization that contributed to political candidates through affiliated PACs. While the firm obtained letters stating its dues would not be used for political contributions, it had no procedures to monitor the PAC's activities or ensure its dues were not used for prohibited contributions.

MSRB Rule G-37 exists to prevent pay-to-play arrangements in municipal securities. For investors in municipal bonds, this rule helps ensure that underwriting business is awarded based on merit rather than political connections.

Show Less

According to FINRA, Hovde Group, LLC has been censured, fined $60,000, and required to certify remediation for failing to establish and maintain supervisory systems for reviewing securities transactions in associated persons' outside brokerage accounts.

The firm had no written procedures or proce...

Read More

According to FINRA, Hovde Group, LLC has been censured, fined $60,000, and required to certify remediation for failing to establish and maintain supervisory systems for reviewing securities transactions in associated persons' outside brokerage accounts.

The firm had no written procedures or processes requiring it to track or verify that it received and reviewed account statements for each disclosed outside brokerage account. The firm also had no written procedures to ensure account statements were actually reviewed once received.

As a result, the firm failed to review any account statements for more than 140 disclosed outside brokerage accounts belonging to its associated persons. This supervisory gap could allow potential violations of securities laws or FINRA rules to go undetected.

Rules requiring firms to monitor associated persons' outside accounts exist to detect potential insider trading, front-running, or other misconduct. When firms fail to review these accounts, they cannot identify suspicious trading patterns that might indicate wrongdoing.

The firm has since revised its procedures for reviewing associated persons' disclosed outside securities accounts. Investors should know that regulatory requirements exist to help detect and prevent misconduct by financial professionals, though this case shows such systems are only effective when properly implemented.

Show Less

According to FINRA, Vorpahl Wing Securities Inc. has been censured, fined $25,000, and required to certify remediation for conducting a securities business while failing to maintain required minimum net capital.

The firm overstated its net capital due to inaccurate computations, incurring net cap...

Read More

According to FINRA, Vorpahl Wing Securities Inc. has been censured, fined $25,000, and required to certify remediation for conducting a securities business while failing to maintain required minimum net capital.

The firm overstated its net capital due to inaccurate computations, incurring net capital deficiencies on at least 10 business days ranging from $1,593.61 to $40,274.44. The errors included improperly classifying unearned investment advisory fees as allowable assets and using cash-basis accounting instead of the required accrual method.

Despite its net capital falling below required minimums on at least 10 business days between January 2022 and March 2023, the firm did not file a Net Capital Deficiency Notice with the SEC or FINRA until March 2023. The firm also failed to prepare net capital computations each month, instead only preparing them during months when FOCUS reports were due.

The firm's supervisory procedures did not include processes for supervising the preparation of financial statements or net capital computations. In practice, the firm's bookkeeper prepared these documents without supervision by the Financial and Operations Principal.

Net capital requirements exist to ensure broker-dealers maintain sufficient liquid assets to meet their obligations to customers. When firms operate below these thresholds, customer funds and securities could be at risk if the firm faces financial difficulties.

Show Less