AWC/2010022690601/November 2011
OS/2009020645901/October 2011
AWC/2010024803101/October 2011
At the request of a member firm customer, Bunshaft was directed to make direct payments from one of the customer’s brokerage accounts at the firm to pay some of the customer’s personal bills; instead, without the customer’s knowledge or authorization, Bunshaft initiated $23,471.25 in unauthorized transfers of funds from the customer’s brokerage account to pay her own personal credit card charges.
Bunshaft failed to respond to FINRA requests for information.
2009018661801/September 2011
Spotts wrongfully misappropriated approximately $197,860 from a coworker at his member firm by taking blank personal checks belonging to the coworker and forged the coworker’s name on the checks without the coworker’s knowledge or authorization. Spotts made some of the checks payable to himself and deposited the checks into his personal account, or made the checks payable to credit card companies and other creditors to pay his personal bills.
Spotts failed to appear and testify at an onthe- record interview.
AWC/2010021962101/September 2011
Pappas converted funds totaling $157,563.75 from customer accounts, without the customers’ knowledge or authorization, and attempted to convert an additional $14,260 from another customer account.
Pappas misappropriated the funds by activating the online bill payment feature in the clients’ accounts and then directed payments to his personal credit cards. Pappas placed an unauthorized trade totaling $6,893.43 in a deceased firm customer’s account.
Pappas refused to respond to FINRA requests for information and testimony.
OS/2009019349301/July 2011
Martin misappropriated at least $81,670 from her employer and its owner through the use of credit cards and checks for unauthorized purposes.
Without authorization, Martin used her employer’s personal credit cards and business credit account to purchase personal items, totaling at least $34,516, and used her employer’s business checking account, without authorization, to issue checks for personal items exceeding $1,603. The Martin issued checks from the business account to herself and made cash withdrawals for herself without authorization; these withdrawals exceeded the actual business expenses by at least $23,385. Martin issued, or caused to be issued, checks to herself for unauthorized bonus payments totaling at least $22,166.
Martin failed to appear for FINRA on-the-record testimony.
AWC/2009019865801/July 2011
Cruz participated in an outside business activity without providing her member firm with prior written notice.
An individual offered Cruz $3,000 in exchange for referring firm clients and others with available credit on their personal credit cards who would invest in his newly created business. The individual failed to pay those who invested in his business as promised. Cruz misrepresented to her firm her involvement in the outside business activity on a compliance her firm review conducted. Upon admitting her involvement in the outside business activity to her firm, the firm immediately suspended Cruz, conducted an internal investigation and later terminated Cruz.
AWC/2009017857501/July 2011
Iskric misused his member firm’s funds by using the firm’s corporate credit card for personal purposes, including purchases of gift cards from various retailers. The amount of unauthorized charges was in excess of $10,000.
While registered with a different member firm, Iskric failed to timely update his Form U4 with material information.
2008011719501/July 2011
Newman converted $10,166.34 by using her member firm’s corporate credit cards to pay for a personal vacation and misappropriating her firm’s credit card rewards points for her personal use.
Newman did not have the firm’s permission or consent or the authority to charge her personal vacation to her firm issued credit cards or appropriate reward points for her own use.Newman did not inform anyone at her firm or memorialize or otherwise create a record of these charges. She reimbursed the firm for the charges but not for the credit card rewards points. Newman intentionally created fictitious and false entries in the firm’s books to cover up her conversion of firm funds for her personal benefit.
AWC/2009018870401/July 2011
Stern charged personal expenses on her corporate credit card totaling approximately $5,200. Stern made approximately $2,700 in payments to the bank affiliate of her member firm for the personal expense which she charged on her corporate credit card.
The bank notified Stern on several occasions about a number of aged items that were charged on the card for which no employee expense reports were submitted by Stern. Subsequently, the bank notified Stern that her card was two payments past due and it was being suspended.
Stern then admitted that she had made the personal purchases on her corporate credit card. Stern also made a $500 payment to the bank and thus reduced the outstanding amount owed due to her personal use of the corporate card to $1,984.
Stern’s employment at her firm and the bank were terminated for improper use of the corporate credit card.
AWC/2010021389601/April 2011
#2009019332001/February 2011
AWC/2009017755101/January 2011
Without permission or authority, Duncan used $100,000 drawn from an elderly person’s bank account to pay his personal credit card expenses, which were related to costs associated with the construction of his home. When the executor of the deceased person’s estate became concerned about the withdrawals totaling $100,000, Duncan created fictitious cashier’s checks totaling $100,000 and payable to charities, falsely representing that the checks represented evidence of the payments made by the deceased and the beneficiaries of the payments. The withdrawals were earlier used to purchase cashier’s checks payable to an international commercial bank to pay down Duncan’s credit card expenses.
A bank compensated the customer for the wrongfully taken funds, and Duncan has reimbursed the bank approximately $91,484.75 and continues to make monthly payments to cover the amounts the bank paid to the customer.
AWC/2008014825001/January 2011
Medearis became an additional credit card holder on a customer’s credit card accounts which were revolving lines of credit. Medearis made charges to the cards totaling approximately $134,000, effectively borrowing this amount through the credit card transactions, and subsequently made payments to cover the charges.
Medearis’ member firm’s written procedures prohibited registered representatives from borrowing money from or loaning money to customers unless the customer was a member of the registered representative’s immediate family and the registered representative had requested and received prior written permission from the firm. Medearis borrowed an additional $132,000 from the customer in separate transactions, and Medearis never informed his firm.
Medearis loaned $6,420.33 to a customer who was a member of his immediate family but failed to obtain the firm’s prior written permission before entering into the loan arrangement with the customer.
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