← Broker database 2025-01-23
Anthony J. Seifert Suspended for Unauthorized Discretionary Trading
According to FINRA, Anthony J. Seifert has been fined $5,000 and suspended from association with any FINRA member for 20 business days for exercising discretion in customer accounts without proper authorization.
Seifert placed transactions in customer accounts without their written authorization for each trade and without his member firm having accepted the accounts as discretionary. While the customers knowingly permitted Seifert to exercise discretion, proper documentation is still required.
Discretionary authority allows a broker to make trading decisions without obtaining specific approval for each transaction. Because this gives significant control to the broker, FINRA rules require explicit written authorization from customers and firm acceptance of the arrangement.
Even when customers informally agree to let their broker make trading decisions, the failure to obtain proper written authorization violates securities rules. These requirements exist to ensure customers clearly understand and formally consent to giving up control over individual trading decisions.
Investors should understand the difference between discretionary and non-discretionary accounts. If you want your broker to make trading decisions without your approval for each trade, ensure you have signed appropriate discretionary authorization documents. If you have not signed such documents, your broker should be contacting you before executing trades.