According to FINRA, Timothy Royce Bush was assessed a deferred fine of $2,500 and suspended from association with any FINRA member in all capacities for two months for maintaining an outside investment account without his member firm's approval.

Bush had sought the firm's approval to maintain an outside investment account he held at another financial institution. Although his firm denied Bush's request and instructed him to close the account or move it to an approved financial institution, Bush maintained and transacted in the account for over four additional years. In addition, Bush falsely attested on annual compliance questionnaires that all of his outside investment accounts were held at custodians approved by the firm.

Firms require representatives to maintain accounts at approved institutions so they can monitor trading activity and detect potential conflicts of interest, insider trading, or other misconduct. When representatives maintain secret accounts at unapproved institutions, they prevent their firms from conducting this important oversight.

This case demonstrates the importance of complying with firm policies regarding outside accounts. Even though Bush's trading may have been legitimate, his willful violation of firm policy and false attestations on compliance questionnaires warranted disciplinary action.