According to FINRA, Ariel A. Rivero was fined $15,000 and suspended from association with any FINRA member in all capacities for six months.

Rivero caused his member firm to maintain incomplete books and records by using an unapproved instant messaging application to communicate with firm customers regarding securities-related business. The instant messaging application was not an approved channel for electronic communications, so the firm did not capture or maintain these communications. The messages included obtaining authorization to buy and sell stocks, discussions about account performance, and discussions related to a customer complaint and loan. Rivero also falsely attested that he did not use unapproved messaging services for business-related communications.

Additionally, Rivero borrowed $500,000 from a firm customer without providing prior written notice to or obtaining written approval from the firm. The customer was not an immediate family member or a financial institution, making this a prohibited borrowing arrangement. Rivero has repaid more than half of the amount and is current on his payments, but the loan was not properly disclosed or approved.

Rivero also attempted to settle a customer complaint without notifying his firm. The customer, who was also Rivero's former brother-in-law, complained about losses from investments in non-traditional exchange traded funds. Through the instant messaging application, Rivero offered to reimburse the customer over $300,000 in monthly installments of $10,000. He did not disclose either the complaint or his settlement attempt to his firm. Ultimately, no settlement was reached, and the customer filed an arbitration claim against the firm and Rivero, which the firm later settled.

These violations demonstrate multiple compliance failures. Off-channel communications prevent firms from supervising broker-customer interactions and create opportunities for misconduct outside firm oversight. Undisclosed borrowing creates conflicts of interest—a broker who owes money to a customer cannot provide objective advice. Attempting to settle complaints privately prevents firms from identifying problems and protecting other customers.

Investors should be wary of brokers who want to communicate through personal messaging apps rather than firm channels. They should also never lend money to their broker, as this creates an inappropriate relationship and conflicts of interest.