According to FINRA, Barry Luther Buchholz was fined $7,500, suspended from association with any FINRA member in all capacities for one month, and ordered to pay disgorgement of $7,480 in commissions plus interest for effecting unauthorized transactions totaling more than $590,000 in the accounts of four customers.
The findings revealed unauthorized trading in the accounts of four adult daughters of a deceased senior customer. After their father passed away, each daughter opened a non-discretionary brokerage account at Buchholz's member firm with Buchholz as their assigned registered representative. Once the accounts were funded with proceeds from their father's estate, Buchholz placed trades to purchase $590,795 in mutual fund shares, generating $16,245.63 in commissions paid to Buchholz.
Critically, Buchholz did not seek or obtain written or oral authorization from the customers to place these trades. The customers learned of the trades only when they received their account statements—discovering that substantial transactions had occurred in their accounts without their knowledge or consent.
After learning of the unauthorized trades, one customer directed Buchholz to sell the mutual fund shares, which he did two business days later. Shortly thereafter, Buchholz sold all shares held in another customer's account without obtaining her written or oral authorization—compounding the unauthorized trading with an additional unauthorized liquidation. These liquidations collectively resulted in realized losses for both customers.
The remaining two customers did not liquidate their mutual fund shares and ultimately saw positive returns on the investments. However, the fact that some investments ultimately performed well does not excuse unauthorized trading. Customers have the right to control their own accounts and make their own investment decisions, regardless of whether unauthorized trades happen to be profitable.
Buchholz earned $7,480 in commissions from trades in the accounts of the two customers who retained the investments. FINRA ordered disgorgement of these commissions, ensuring that Buchholz does not profit from unauthorized trading.
All four customers filed complaints with Buchholz's firm about the unauthorized trades. The first two customers entered into settlements that repaid them for their losses, with Buchholz personally contributing $15,000 toward these settlements—a recognition of his wrongdoing.
The one-month suspension, in effect from December 1, 2025, through December 31, 2025, along with the $7,500 fine and disgorgement order, reflects the seriousness of unauthorized trading while recognizing Buchholz's personal contribution to making customers whole.
Investors should carefully review all account statements and immediately report any unauthorized transactions to their firms and regulators.
