FINRA Bars Registered Representative for Unauthorized and Unsuitable Trading in Elderly Customer’s Retirement Account
WASHINGTON–(BUSINESS WIRE)–The Financial Industry Regulatory Authority (FINRA) announced today that
it has barred former K.C. Ward Financial registered representative Craig
David Dima for making unauthorized and unsuitable trades totaling
approximately $15 million in a 73-year-old retiree’s account, and for
misrepresenting the reasons for the trades to the customer.
Susan Schroeder, FINRA Acting Head of Enforcement, said, “There is no
place in this industry for brokers who take advantage of elderly
customers. Protecting senior investors from predatory behavior such as
unsuitable and unauthorized trading is part of our core mission and will
always be a priority for FINRA.”
FINRA found that on 11 occasions, Dima sold virtually all of the
customer’s Colgate-Palmolive stock, accumulated over 28 years of
employment at the company, without the customer’s permission. In fact,
Dima sold the customer’s shares even after the customer told Dima not to
sell the stock, which she considered a valuable long-term investment and
reliable source of dividends. When confronted by the customer about the
sales, Dima misrepresented to her that they were caused by a “computer
glitch” or a technical error. In connection with Dima’s unauthorized
sales and subsequent repurchases of Colgate stock, Dima charged the
customer more than $375,000 in mark-ups, mark-downs and fees and
deprived the customer of substantial dividends had she held the Colgate
shares as intended.
FINRA also found that Dima’s trading of the customer’s Colgate shares
was unsuitable and violated FINRA rules prohibiting excessive mark-ups
and mark-downs.
In settling this matter, Dima nether admitted or denied the charges, but
consented to the entry of FINRA’s findings.
Investors can obtain more information about, and the disciplinary record
of, any FINRA-registered broker or brokerage firm by using FINRA’s
BrokerCheck. FINRA makes BrokerCheck available at no charge. In 2016,
members of the public used this service to conduct 111 million reviews
of broker or firm records. Investors can access BrokerCheck at http://www.finra.org/brokercheck
or by calling (800) 289-9999. Investors may find copies of this
disciplinary action as well as other disciplinary documents in FINRA’s
Disciplinary Actions Online database. Investors can also call FINRA’s
Securities Helpline for Seniors at (844) 57-HELPS for assistance or to
raise concerns about issues they have with their brokerage accounts and
investments.
FINRA is dedicated to investor protection and market integrity. It
regulates one critical part of the securities industry – brokerage firms
doing business with the public in the United States. FINRA writes rules,
examines for and enforces compliance with FINRA rules and federal
securities laws, registers broker-dealer personnel and offers them
education and training, and informs the investing public. In addition,
FINRA provides surveillance and other regulatory services for equities
and options markets, as well as trade reporting and other industry
utilities. FINRA also administers a dispute resolution forum for
investors and brokerage firms and their registered employees. To see if
your investment professional is regulated by FINRA, please go to BrokerCheck.
And for more information, visit www.finra.org.
Contacts
FINRA
Michelle Ong,
202-728-8464
or
Nancy
Condon, 202-728-8379
