According to FINRA, Jonathan Earl Best has been assessed a deferred fine of $12,500, suspended from association with any FINRA member in all capacities for three months, and ordered to pay deferred disgorgement of $10,760.88 plus interest for effecting unauthorized trades in the account of a senior customer with diminished capacity.

Best knew the customer was exhibiting signs of diminished capacity and informed her relative that he could not effect any transactions due to her condition. He then requested that the relative obtain a physician's letter to trigger his appointment as co-power of attorney under the customer's estate planning documents.

Best submitted an OBA request to serve as the customer's future co-power of attorney but failed to inform his supervisor that the customer was unable to care for herself, was living in a care facility, and was unable to discuss and understand investments. His supervisor rejected the OBA request and instructed Best to recuse himself, but Best never provided documentation of recusal.

Despite knowing the customer could not authorize transactions, Best effected purchases of laddered certificates of deposit in her account with a principal value totaling $14,199,847 without authorization. He earned $10,760.88 in compensation from these trades.

Best also falsely attested on compliance questionnaires that he had no senior investors for which he was concerned about their capacity to make sound decisions.

This case illustrates the importance of protecting senior investors. When representatives recognize diminished capacity, they must take appropriate steps to protect the customer, not continue trading to generate commissions.

Family members of seniors should be vigilant about monitoring accounts and ensuring proper authorization is in place before any trading occurs.