← Broker database 2025-09-30
Luke Lannister Suspended Two Months for Unauthorized Discretion
According to FINRA, Luke Lannister was assessed a deferred fine of $5,000 and suspended from association with any FINRA member in all capacities for two months for exercising discretion in customer accounts without proper authorization.
Lannister exercised discretion without written authorization in accounts held by two customers, executing trades without first speaking to the customers on the day of the transactions. Although the customers generally understood that Lannister was exercising discretion in their accounts, neither gave him their prior written authorization to do so and his member firm did not accept the accounts as discretionary.
Additionally, Lannister inaccurately stated in annual compliance questionnaires submitted to the firm that he had not exercised discretion in customer accounts without express written approval from the firm.
Discretionary trading authority allows a representative to make investment decisions for a customer without obtaining specific authorization for each transaction. Because of the significant control this gives the representative over customer assets, FINRA and SEC rules require written authorization from the customer and acceptance by the firm before discretionary trading can occur.
Even when customers informally agree to allow discretionary trading, the formal requirements exist to protect both the customer and the representative by clearly documenting the scope of authority and ensuring appropriate firm supervision of discretionary accounts.
The false statements on compliance questionnaires compound the violation by preventing the firm from detecting and supervising the unauthorized discretionary trading.
The suspension is in effect from October 6, 2025, through December 5, 2025. Investors should ensure that any discretionary authority they grant is properly documented in writing and understand that they have the right to require specific authorization for each trade.