According to FINRA, Jeffrey Arthur Perryman was barred from association with any FINRA member in all capacities on October 7, 2024, after refusing to provide information and documents requested by FINRA in connection with its investigation into his potential undisclosed outside business activities, including charging fees to a customer for services that he failed to disclose to his member firm.

Outside business activities must be disclosed to firms so they can assess potential conflicts of interest and ensure appropriate supervision. When brokers engage in undisclosed outside business activities, particularly those involving customers, it creates significant risks. The broker may be providing services without firm oversight, making unsuitable recommendations to generate business for the outside activity, or engaging in outright fraud.

The allegation that Perryman charged fees to a customer for undisclosed services is particularly concerning. This suggests he may have been operating a side business involving customers without the firm's knowledge or approval. Such arrangements create obvious conflicts of interest and raise questions about whether the customer understood what services were being provided and whether the fees were appropriate.

By refusing to provide information and documents about these activities, Perryman prevented FINRA from investigating the nature of his outside business activities, what services he provided to customers, how much he charged, and whether customers were harmed. This obstruction of FINRA's investigation resulted in a permanent bar from the industry.

Investors should be wary of brokers who request fees for services outside the normal brokerage relationship. If a broker asks you to pay for consulting, financial planning, or other services separately from your brokerage account, you should ask detailed questions about what services are being provided, whether the firm has approved this arrangement, and whether the fees are reasonable. Legitimate services should be documented in writing with clear fee schedules.

The refusal to cooperate with FINRA's investigation suggests Perryman had no good explanation for his outside business activities and the fees he charged. This case demonstrates why disclosure requirements for outside business activities exist—they protect investors from conflicts of interest and ensure firms can properly supervise their representatives.

Investors can check whether their broker has been barred or has any disciplinary history through FINRA's BrokerCheck system. A bar for refusing to cooperate with an investigation about undisclosed outside business activities should raise serious concerns about the individual's integrity and trustworthiness.