FINRA U5 Expungement Award:
Financial advisor receives U5 termination disclosure for alleged firm violation
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Award Date: May 28th, 2021
Hearing Site: Seattle, Washington
Respondent Firm: Voya Financial Advisors, Inc.
Claimant Representative: Benjamin Winograd, J.D.
A financial advisor from the west coast was terminated for an alleged violation of a firm policy. During her tenure with the firm, she was never disciplined and consistently received positive performance reviews from her bosses and clients.
As with most Form U5 terminations in the industry these days, there were other factors at the firm level that were weighing on the decision to discharge this advisor.
The advisor wanted to prove that the allegations were false and that she was simply a sacrificial lamb. That’s when she decided it was time to hire AdvisorLaw to prove that her U5 termination and subsequent Employment Separation After Allegations disclosure were defamatory in nature and must be removed from her CRD and FINRA’s BrokerCheck site.
The financial industry is ripe with Form U5 terminations that are very rarely filed for the reasons that are reported in the disclosure. In this case, the employing firm alleged that the advisor in question “…conducted a seminar prior to receiving approval from the firm.” Typically, most any action by a financial advisor must be signed off by compliance first. However, in this case, the advisor never actually did what the firm was alleging. It’s hard to have sought approval for an action that you did not take.
Do you have a meritless disclosure on your BrokerCheck, IAPD, or CRD record? Give us a call today at (303) 952-4025 or contact us for a complimentary consultation.
The seminar in question was actually a charitable planning seminar led by a separate financial advisor who was a friend of hers. As a favor to her friend, this advisor helped with administrative tasks, like lining up a venue and sending out mailers. She ended up attending her friend’s seminar, not as an advisor but as an actual attendee. Other financial professionals were in attendance, as well, to learn more ways to help their own clients.
Our client was not a sponsor, never paid for any portion of the seminar, and did not join any of the presentations. Additionally, she did not receive any commission, splits, or payment for her help. However, the firm felt that she had violated advertising regulations by simply attending.
After reviewing the evidence, a FINRA arbitration panel found that, “although [the advisor] assisted a friend in securing a location for a charitable planning education luncheon even and forwarded less than a dozen invitations to fellow financial industry professionals, [she] participated in the event only as an attendee. [She] did not conduct the event in any sense of the word and therefore, she did not violate any regulation or policy.”
The Panel recommended expungement of the disclosure and amendment of the Reason for Termination, from “Discharged” to “Voluntary.” All allegations, comments, and references to the occurrence should also be deleted entirely.
This advisor can now have her record cleared of a violation that never even happened “in any sense of the word.”
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