← Broker database 2023-04-11
Gordon Wallace Suspended 10 Days for Improperly Removing Customer Information
According to FINRA, Gordon Scott Wallace was fined $5,000 and suspended for 10 business days for improperly removing non-public personal customer information from his member firm without the firm's or customers' consent.
In anticipation of joining another member firm, Wallace took photographs of account information contained within his firm's electronic systems, including customer names, dates of birth, customer account numbers, and social security numbers. Wallace also directed junior members of his brokerage team to photograph account information contained within the firm's systems, including non-public personal information of customers.
Following Wallace's resignation from the firm, he and members of his brokerage team improperly retained the customers' non-public personal information. The information was secured by the firm through which Wallace had become registered, and that firm returned the customers' non-public personal information to Wallace's previous firm prior to its use.
The improper removal and retention of customer non-public personal information poses serious privacy and security risks. Customer information including social security numbers and account numbers can be used for identity theft or unauthorized access to accounts. Registered representatives do not have the right to take customer information when they leave a firm, even if they intend to continue serving those customers at a new firm. The proper procedure is to request that customers authorize the transfer of their accounts to the new firm.
This case demonstrates that even when no actual misuse of customer information occurs, the unauthorized removal and retention of sensitive personal data is a serious violation. Investors should be aware that their personal information must be protected and can only be accessed and used for legitimate business purposes.