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2003
NASD Disciplinary Actions
 Private Securities (PS) Transactions

NASD CONDUCT RULE 3040. Private Securities Transactions of an Associated Person
(a) Applicability
No person associated with a member shall participate in any manner in a private securities transaction except in accordance with the requirements of this Rule.

(b) Written Notice
Prior to participating in any private securities transaction, an associated person shall provide written notice to the member with which he is associated describing in detail the proposed transaction and the person's proposed role therein and stating whether he has received or may receive selling compensation in connection with the transaction; provided however that, in the case of a series of related transactions in which no selling compensation has been or will be received, an associated person may provide a single written notice.

(c) Transactions for Compensation
(1) In the case of a transaction in which an associated person has received or may receive selling compensation, a member which has received notice pursuant to paragraph (b) shall advise the associated person in writing stating whether the member:
(A) approves the person's participation in the proposed transaction; or

(B) disapproves the person's participation in the proposed transaction.

(2) If the member approves a person's participation in a transaction pursuant to paragraph (c)(1), the transaction shall be recorded on the books and records of the member and the member shall supervise the person's participation in the transaction as if the transaction were executed on behalf of the member.

(3) If the member disapproves a person's participation pursuant to paragraph (c)(1), the person shall not participate in the transaction in any manner, directly or indirectly.

(d) Transactions Not for Compensation
In the case of a transaction or a series of related transactions in which an associated person has not and will not receive any selling compensation, a member which has received notice pursuant to paragraph (b) shall provide the associated person prompt written acknowledgment of said notice and may, at its discretion, require the person to adhere to specified conditions in connection with his participation in the transaction.

(e) Definitions
For purposes of this Rule, the following terms shall have the stated meanings:

(1) "Private securities transaction" shall mean any securities transaction outside the regular course or scope of an associated person's employment with a member, including, though not limited to, new offerings of securities which are not registered with the Commission, provided however that transactions subject to the notification requirements of Rule 3050, transactions among immediate family members (as defined in IM-2110-1, "Free-Riding and Withholding"), for which no associated person receives any selling compensation, and personal transactions in investment company and variable annuity securities, shall be excluded.

(2) "Selling compensation" shall mean any compensation paid directly or indirectly from whatever source in connection with or as a result of the purchase or sale of a security, including, though not limited to, commissions; finder's fees; securities or rights to acquire securities; rights of participation in profits, tax benefits, or dissolution proceeds, as a general partner or otherwise; or expense reimbursements.

NOTE: Offers of Settlement (OS) and Letters of Acceptance, Waiver, and Consent (AWC) are entered into by Respondents without admitting or denying the allegations, but consent is given to the described sanctions and to the entry of findings.

Respondent/NASD Case # Bar

Suspension
/bd =  business days
/m = months 
/y = years

Note:  suspensions are in "all " capacities unless otherwise indicated

Monetary Sanctions
F = fine
D = disgorgement 
DF = disgorgement included in fine
R = restitution
XF = No fine due to "financial status"

Addt'l Factors
XR = failed to provide info or appear for testimony

OB = also engaged in outside business activities

cases resulting in suspension but not bars

C. Mark Ostrowski (AWC/C9A030001/March 2003)
15/bd  $5,000 F
$2.900.85 D

 

David Earl Peterson(AWC/C02030051/Oct 2003)   20/bd $5,000 F Peterson failed to supervise a registered representative
James Nelson Gould(AWC/C02030052/Oct 2003)   20/bd $5,000 F Gould failed to supervise an individual engaged in fraudulent private securities transactions
Thomasina Michalik (AWC/CLI030015/August 2003)   20/bd $5,000 F  
Robert D’Agosta (AWC/C02030050/Oct 2003) 30/d $5,000 F
Michael G. Kamrath (AWC/C02030056/November 2003) 30/bd $7,500 F
Homer Lynn Gary Baird, Jr. (AWC/C05030013/May 2003) 30/d $5,000 F
Craig Stuart Balsam (AWC/C10030025/June 2003) 30/d $5,000 F
Lorraine Henry Geiss (AWC/C8A030023/May 2003) 30/d $5,000 F
Scott Bradley Hollenbeck (AWC/C07030021/June 2003) 30/d $5,000 F
Gregory Raymond Anderson (OS/C8A020061/May 2003) 1/m $2,500 F
Robert Theodore Milley, II (AWC/C9A030035/December 2003) 60/d $10,000 F
Anthony Charles Fricano (AWC/C8A030011/April 2003) 2/m  $5,950 F
$950 DF
Edward Douglas Shanklin,Jr. (AWC/C05030033/August 2003)   8/w XF  
Todd Christopher Sunday (AWC/C8B030024/December 2003) 8/w $5,000 F
$5,250 D
Vincent John Gallo (AWC/C07030044/August 2003)   90/d $17,500 F
$11,672.21 DF
 
Leroy Avery (C8A020032/ May 2003) 90/d $28,559 F
$28,559 DF
OB
Janice Poland Tanno(AWC/C8B030017/Oct 2003)   3/m XF  
Richard Craig Niece (AWC/C3B030013/Oct 2003)   3/m $10,000 F  
David Paul Folino (AWC/C06030006/June 2003) 3/m $5,000 F
$17, 250 D
Anthony Galeotafiore
Francis Louis Smookler, Jr.
Mark David Pellettieri
(OS/CLI020006/April 2003)
3/m  Each $5,000 F
Joint/Several $250,150 D
All OB
James Milton Seltzer (AWC/C3B030003/March 2003)
3/m  XF  
Alan Robert Blumel (AWC/C3A030006/April 2003) 3/m  $10,912.50 F
$3,412.50 DF
Edward Douglas Shanklin,Jr. (AWC/C05030033/August 2003)   8/w XF  
Robert Alan Brannon (AWC/C3B030010/August 2003)   4/m XF  
Alonso Martin Martinez (OS/C05020052/March 2003)
4/m  $60,000 F
$55,316.88 DF
Robert James Hudson, Jr. (AWC/C11030001/March 2003)
5/m  $5,000 F
$90,000 D
XR
John William West (AWC/C8B030019/November 2003) 6/m $5,000 F
Steven Dean Yarn(AWC/C9A030027/Oct 2003)   6/m $10,000 F
$120,000 R
 
Michael Court Scanlon (AWC/C8B030011/August 2003)   6/m $5,000 F  
David Lee Pearlman (AWC/C8A030050/August 2003)   6/m $10,000 f  
James Stanley Freeman (AWC/C01030006/April 2003) 6/m  $15,250 F
$10,250 DF
OB
Timothy John Sherer (OS/C01020011/April 2003) 6/m 
Young Min Kim (C02020014/March 2003) 7/m  $113,687.50 F Requalify as principal and representative
James Oscar Green (AWC/C05030002/March 2003)
8/m  XF Also unsuitable variable annuity transactions
Miguel Angel Martinez, Sr. (AWC/C10030026/June 2003) 9/m $10,000 F
John Murk Lockman, Jr.(AWC/C07030058/Oct 2003)   1/y $10,000 F OB
Dennis Leyman Siers (AWC/C8B030002/March 2003)
1/y  $65,000 D
Gary Donald Cowell (AWC/C9A030004/April 2003) 1/y  $25,000 F
$47,550 D
OB
Phiolip Peter Mrcucci, Sr. (OS/C9A030020/November 2003) 15/m $75,000 F
Paul Wilson Gillis, Jr. (AWC/C02030063/November 2003) 18/m $57,593 F
Greer Alan Kendall (AWC/C06030003/April 2003) 18/m  $10,000 F
Edward Leoncio Mesa (AWC/C07030008/April 2003) 18/m  $7,500 F
$85,200 D

David Carroll Loach (AWC/C3A030016/July 2003)

18/m $7,500 F

Jesse Jackson Bradin (AWC/C11030028/Oct 2003)

2/y $5,000 F
$70,300 D (commissions) plus partial restitution plus interest to customers

cases resulting bars

Robert William Jenkins (AWC/C8A030076/December 2003) X Provided forged documents to NASD; failed to respond to requests for information
William Gordon Hoover, Jr. (AWC/C3A030043/December 2003) X OB; Failed to disclose material facts on U4; failed to respond to requests for information
David Paul Vanderzee (AWC/C11030033/November 2003) X
Brian James Clark (C9B020052/November 2003) X Submitted U4 with false information.
Anthony Harold Barkate (C02010041/November 2003 --- On appeal to SEC ) X Barkate did not give prior written notice to his member firm
Bruce Lynn Troyer (AWC/C04030049/Oct 2003) X   $5,000 F

$87,250 R

Troyer received $28,000 in checks from customers to be invested, but  deposited them  into an account under his control; and  received a $5,000 check from a representative on behalf of a public customer to be invested,which he also deposited into his own account ( then  held the funds  and later nvested)
John Battista Sacco(AWC/C10030005/Oct 2003) X    $10,000 R Also  induced a customer to invest $10,000 in securities and made misrepresentations and omissions of material fact regarding the company’s ownership and pending public offerings of stock; XR
Richard Leroy Harden
(AWC/C11030029/Oct 2003)
X   $1,448,041 R XR
Robert Thomas Bullock
(AWC/C11030029/Oct 2003)
X XF Sent false and misleading statements to customer; made written/verbal misstatements in connection with offer and sale to customer; and received $50,000 from customer for investment bu deposited it into a company Bullock partially owned
Gloster Knox Sonia
(C05030007/Sept 2003)
X
Austin Charles Cogswell
(AWC/C07030052/Sept 2003)
X OB
Michael Allen Loween (AWC/C3B030009/August 2003) X     OB
Terrance Gary Buyze
(AWC/C8A030054/August 2003)
X     OB; XR
Emmett Maurice Abercrombie (OS/C07030020/August 2003) X     Also intentionally failed to disclose to firm sales of units in a private  placement.
William John Henderson, III (AWC/C11030015/June 2003) X
John Oliver Edwards (OS/C3A020029/June 2003) X
Andrew Savvas Constantinou (AWC/C11030004/March 2003)
X $297,250 D Also made improper use of customer funds;  used $106,000 in charitable remainder trust funds for the purchase of his residence; and opened account at another BD without required  disclosures. XR
Stephen Earl Prout (C07020061/March 2003) X XR
Edmund Joseph Menden (C04020025/March 2003) X XR
Jason Lee Kibbee (AWC/C04030004/March 2003)
X XR
Richard Vincent Coyer (C02020039/March 2003)
X XR

Orlan Kenneth Boyd, Jr. (AWC/C04030002/March 2003) 

X $80,974.42 D Engaged in securities transactions w/o being properly registered
Jacques Manlio Chrysoschoos (AWC/C07030011/April 2003) X
Howard Scott Ismark (C07020070/April 2003) X $3,518.64 D Also unauthorized trading; XR
Anthony Benjamin Phillips (OS/C8A020089/April 2003) X XR
Frederick Stratton Sundin (AWC/C11030006/April 2003) X $58,551.02 D Suitability violation in recommending  a $55,551.02 purchase by customer of limited partnership interest
Jeffrey Michael Kirschner (AWC/C02030019/May 2003) X

Richard Lynn Pugh (OS/C3A030003/May 2003)

X XR
Darrell Todd Gibson (C06020024/July 2003) X XR; Recommended unsuitable purchase of a promissory note; sole securities without being properly registered with NASD; 
 

 





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