According to FINRA, John Winslow was barred from association with any FINRA member in all capacities for refusing to produce information and documents requested by FINRA.
FINRA was investigating the circumstances disclosed in a Form U5 filed by Winslow's member firm. The firm disclosed that it had terminated Winslow's employment because he failed to disclose that he received funds from a client. The firm subsequently filed an amended Form U5 that further disclosed that Winslow's client alleged that he had not returned any of the funds that were transferred to him and refused to do so.
These circumstances suggest potential conversion of customer funds, which is the unauthorized taking of customer money for personal use. This is one of the most serious violations in the securities industry as it represents theft from clients who trusted their broker with their money.
When FINRA requested information and documents about these circumstances, Winslow refused to provide them. This refusal prevented FINRA from conducting a thorough investigation into whether Winslow converted customer funds and determining the full extent of any customer harm.
The obligation to cooperate with regulatory investigations exists to allow FINRA to protect investors and maintain market integrity. Refusal to cooperate, particularly when the underlying allegations involve potential theft of customer funds, is treated as an extremely serious violation.
Investors should understand that registered representatives should never receive funds directly from clients except in very limited circumstances with proper disclosure and approval. If a broker asks for money to be sent directly to them rather than to the firm or custodian, this is a major red flag. The failure to return client funds when requested, combined with refusal to cooperate with investigators, strongly suggests conversion. Investors can check FINRA BrokerCheck to see termination reasons and disciplinary actions, which can reveal patterns of problematic behavior before entrusting money to a financial professional.
