According to FINRA, Marcella Luz Cofre was assessed a deferred fine of $5,000 and suspended for two months for falsifying a customer's signature on an insurance application submitted to her member firm's insurance affiliate.
Cofre electronically signed the customer's name on the insurance application with the customer's consent but did not indicate that she was signing the application on the customer's behalf. Based upon the application, the firm's insurance affiliate issued the customer a life insurance policy.
While the customer consented to Cofre signing the application, the failure to indicate that she was signing on the customer's behalf makes the signature a falsification. Insurance applications and other financial documents require signatures to verify the identity of the person completing the form and to create legal obligations. When someone other than the customer signs without clearly indicating they are signing as an authorized agent or representative, it creates a false document.
The proper procedure when signing on behalf of a customer would be to indicate "[Customer Name] by Marcella Cofre" or similar language clearly showing she signed as the customer's representative. Without such indication, the application appears to have been signed by the customer directly, which is false.
This type of falsification, even when done with customer consent, can cause several problems. First, if questions later arise about whether the customer actually consented to the application, there will be no documentation showing that the representative, rather than the customer, signed. Second, if the application contains information the customer did not personally verify, they may later claim they were unaware of what was submitted. Third, insurance companies rely on the signature to verify the customer reviewed and agreed to the information on the application.
While this violation appears to involve a shortcut taken to expedite processing rather than fraud, it still constitutes document falsification. The customer ultimately received the life insurance policy they wanted, and there's no indication they were harmed. Nevertheless, the falsification violated FINRA rules and firm policies.
For investors, this case illustrates the importance of personally signing financial documents and reviewing them carefully before signing. If a representative offers to sign documents on a customer's behalf, the customer should ensure the representative properly indicates they are signing as an authorized agent. Customers should be wary of representatives who take shortcuts with documentation, as such shortcuts can lead to disputes or compliance problems later. The suspension is in effect from June 6, 2022, through August 5, 2022.
