← Broker database 2023-09-22
William Ard Suspended for Misleading Communications and False Statements
According to FINRA, William Donovan Ard was fined $15,000 and suspended from association with any FINRA member in all capacities for four months for forwarding promissory and misleading communications, making false statements to his firm, causing inaccurate records, and communicating outside approved channels.
Ard forwarded an email that contained promissory, unwarranted, and misleading communication to his customer about investing in a publicly traded biopharmaceutical company. The email described predictions for the company's stock performance—including "bear," "base," and "bull" cases, which varied depending on the results of a drug trial involving a drug the company had developed. Such predictions constitute promissory statements that violate securities regulations because they suggest a certain outcome or return.
Ard also made a false statement to his member firm about a customer's use of borrowed funds. The customer had opened a Liquidity Access Line (LAL) account which allows customers to borrow funds from the firm's affiliate bank based on the value of eligible securities held as collateral. Contrary to firm policy, the customer used LAL funds to purchase publicly traded stocks and options in accounts held outside the firm. When the firm asked Ard why the customer had withdrawn funds from his LAL account, Ard denied knowing the purpose of the customer's withdrawals, even though he knew at the time that the customer had used LAL funds to purchase publicly traded stock.
Additionally, Ard caused the firm's records to be inaccurate by mismarking orders as unsolicited in customer brokerage accounts, when in fact he had solicited the trades. The vast majority of the transactions were purchases of call options. Ard also communicated about firm business on his personal phone outside of a firm-approved application, including text messages with customers about securities transactions. He then submitted annual compliance questionnaires that falsely indicated that he did not use unapproved mobile applications to communicate with customers about trade-related matters.
This case involves multiple serious violations that demonstrate a pattern of dishonesty and disregard for regulatory requirements. The four-month suspension and $15,000 fine reflect the cumulative seriousness of these violations.