According to FINRA, Barry Lee Garapedian was assessed a deferred fine of $5,000 and suspended for three months in all capacities for causing his firm to maintain inaccurate books and records by falsifying representative codes for trades.

Garapedian and other representatives working from the same branch office entered into an agreement to service certain customer accounts under a joint representative code shared with the estate of a retired representative. The agreement specified commission split percentages. Although the firm's system correctly prepopulated trades with the joint representative code, Garapedian directed a junior registered representative to enter transactions under different joint representative codes.

Some transactions were entered under codes through which Garapedian received higher commission percentages than entitled under the agreement. Other transactions were entered under codes giving him lower percentages than entitled. Garapedian mistakenly assumed he had permission to change representative codes to equalize commissions across accounts serviced by the branch office, including those covered by the joint production agreement. However, he had not verified that the estate of the retired representative agreed to these changes.

As a result, the firm's trade confirmations inaccurately reflected different joint representative codes instead of the correct code Garapedian shared with the estate. His actions caused him to receive higher commissions and the retired representative's estate to receive less than entitled under the agreement. The firm subsequently paid approximately $8,000 in restitution to the estate.

Accurate books and records are essential to securities regulation. Representative codes must accurately reflect servicing arrangements and commission entitlements. Changing codes without authorization from all parties, even if intended to equalize commissions, creates inaccurate records and improper commission payments.

The three-month suspension holds Garapedian accountable for directing falsification of representative codes.