According to FINRA, Jonathan Michael Turner was fined $5,000 and suspended for three months on March 24, 2022, for participating in private securities transactions without providing prior written notice to his member firm.

Turner accepted a position as chief investment officer for a credit card processing service company. In this role, he was responsible for creating new investment vehicles and raising investor capital. Turner directed two firm customers to the company's website, recommended they invest, and supplied them with forms needed to purchase the company's securities.

One customer invested $100,000 funded with cash from a personal bank account. The other customer invested $100,000 using proceeds from stock liquidations Turner facilitated from a firm account. Turner received no commissions or other compensation regarding these transactions.

Despite his active role in raising capital for the company and directing firm customers to invest, Turner incorrectly certified in the firm's annual compliance attestation that he had not engaged in any private securities transactions not previously cleared by the firm.

This case illustrates that serving as chief investment officer for another company while working as a registered representative creates obvious conflicts of interest requiring firm disclosure and approval. Turner's role involved raising capital - a securities-related activity that required firm knowledge and supervision.

The fact that Turner directed firm customers to invest in a company where he served as chief investment officer creates multiple conflicts. His position with the company gave him a vested interest in raising capital, which could influence his recommendations to customers. The firm had no opportunity to evaluate whether these investments were suitable for the customers or to assess the conflicts created by Turner's dual roles.

Turner's false attestation that he had not engaged in undisclosed private securities transactions compounded the violation by actively concealing his activities.

This case demonstrates that outside positions involving raising capital or selling securities are private securities transactions requiring firm approval, even without direct compensation. Investors should be cautious when their financial professionals recommend investments in companies where they hold officer positions or other roles that create conflicts of interest.