NOTE: Stipulations of Fact and Consent to Penalty (SFC); 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 & to the entry of findings. Additionally, for AWCs, if FINRA has reason to believe a violation has occurred and the member or associated person does not dispute the violation, FINRA may prepare and request that the member or associated person execute a letter accepting a finding of violation, consenting to the imposition of sanctions, and agreeing to waive such member's or associated person's right to a hearing before a hearing panel, and any right of appeal to the National Adjudicatory Council, the SEC, and the courts, or to otherwise challenge the validity of the letter, if the letter is accepted. The letter shall describe the act or practice engaged in or omitted, the rule, regulation, or statutory provision violated, and the sanction or sanctions to be imposed.

John Paul Coen (Principal)
AWC/2008016448101

Coen borrowed approximately $2,700,000 from a customer and used the loan to trade in his personal brokerage account and cover a margin call. Coen wired $300,000 that he borrowed from the customer to an account another firm customer controlled, claiming that the money was a loan to the customer.

Coen borrowed approximately $270,000 from another firm customer for whom he managed the brokerage accounts for entities the customer controlled.

Coen’s firm did not permit loans from or to customers, and Coen did not request or obtain his firm’s pre-approval (either verbally or in writing) prior to borrowing or lending monies from or to customers, nor did he otherwise inform his firm of the loans.

John Paul Coen (Principal): Fined $50,000; Suspended 18 months

Tags: Borrowing