According to FINRA, Sabrina Hampton (CRD #7144809), a former registered representative based in Phoenix, Arizona, was barred from association with any FINRA member firm in all capacities. The bar was issued on August 8, 2024, through an Acceptance, Waiver, and Consent (AWC) agreement under FINRA Case #2022076988401.
Hampton was found in violation of FINRA rules after she refused to appear for on-the-record testimony requested by FINRA during its investigation into her potential conversion of customer funds. Conversion of customer funds is one of the most serious forms of misconduct in the securities industry. It occurs when a financial professional takes a customer's money or securities and uses them for personal purposes or for purposes not authorized by the customer. In practical terms, this is a form of theft or misappropriation that can devastate investors financially.
FINRA launched its investigation to determine whether Hampton had engaged in the conversion of customer funds. As part of that investigation, the regulator requested that Hampton appear to provide on-the-record testimony. This type of testimony is a critical investigative tool that allows FINRA to question individuals under oath about their conduct and the circumstances under which potential violations may have occurred.
Under FINRA Rule 8210, all persons associated with a FINRA member firm, including former associated persons, are required to cooperate with FINRA investigations. This includes providing testimony when requested. The obligation to cooperate is a fundamental condition of being registered in the securities industry. When individuals refuse to comply with these requests, they obstruct the regulatory process and prevent FINRA from fulfilling its investor protection mission.
Hampton's refusal to appear for testimony is particularly notable given the seriousness of the underlying allegation. Conversion of customer funds is not merely a regulatory infraction; it can also constitute criminal conduct. By refusing to testify, Hampton prevented FINRA from fully investigating the extent of any potential harm to customers.
Without admitting or denying the findings, Hampton consented to the sanction and the entry of findings against her. As a consequence, she is permanently barred from working in any capacity with a FINRA-registered broker-dealer.
This case serves as an important reminder for investors to closely monitor their accounts for any unauthorized transactions or unexplained withdrawals. Conversion of funds may not always be immediately apparent, especially if the amounts are small or if statements are being manipulated. Investors should regularly review their account statements, compare them against their own records, and report any discrepancies to their firm's compliance department immediately. FINRA's BrokerCheck tool is also available to help investors research the background of financial professionals, including any history of disciplinary actions or customer complaints.
