Unsuitable Trade Recommendations and Unauthorized Discretion - South Florida, including Boca Raton and West Palm Beach, FINRA Arbitration Attorney.
Brian John Hussey Jr. (CRD #4640067, Zephyrhills, Florida)
Recently, Brian John Hussey, Jr. entered into an Acceptance, Waiver and Consent with the Financial Industry Regulatory Authority, in which Hussey was suspended from association with any FINRA member in all capacities for seven months. Apparnelty, in light of Hussey's financial status, no monetary sanction was imposed. Hussey, without admitting or denying the findings consented to the sanction and to the entry of findings that he made unsuitable recommendations to a customer that she sell 100 percent of the mutual fund positions in her individual retirement account (IRA) and invest the proceeds in penny stocks focused on the marijuana business. The findings stated that the thinly-traded penny stocks recommendation was inconsistent with the client's investment objectives and financial situation. In addition, the transactions were solicited in violation of Hussey's member firm's policies prohibiting the solicitation of penny stocks. In order to effect the transactions, Hussey mismarked solicited trades as unsolicited in the customer's accounts to avoid the firm's policy preventing its representatives from soliciting the purchase of penny stocks. Moreover, the SEC issued an Order suspending all trading in one of the penny stocks. Hussey had already heavily invested the customer's accounts in that penny stock. Three days after trading resumed in the penny stock, Hussey purchased an additional $22,679.50 in the account. Hussey eventually had 100 percent of the customer's portfolio concentrated in the two penny stocks. After the firm made inquiries regarding the trading activity in the customer's IRAs, and to avoid future compliance issues, Hussey's recommended that the customer move her account to another FINRA member firm, where Hussey, with the customer's permission, engaged in discretionary trading of her account using her login credentials. Hussey did not disclose his exercise of discretion or his discretionary authority in this third party account to his firm or to the executing member firm. The customer complained to Hussey's firm, asserting $58,572 of market losses in her accounts with the firm and the third party firm account, in addition to damages from the lost opportunity to participate in market gains. Hussey's firm settled for $67,019.24, which he is obligated to pay back to the firm. The findings also stated that as stated above, Hussey mismarked order tickets for trades as unsolicited when, in fact, he solicited the trades and therefore caused his firm to maintain false and inaccurate books and records. The suspension is in effect from June 18, 2018, through January 17, 2019. (FINRA Case #2017053342601).
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