FINRA U5 Expungement Award:

Arbitrator Grants Expungement Of 23-Year-Old Termination & Internal Investigation Disclosures


FINRA U5 Expungement Award:

Arbitrator Grants Expungement Of 23-Year-Old Form U5 Termination & Internal Investigation Disclosures


 

*If you're under FINRA or SEC investigation, or if you have a meritless disclosure on your BrokerCheck, CRD, or IAPD record, call us right now at (303) 952-4025 or click here to talk with an attorney and receive a priority consultation at no charge.


Award Date: September 24, 2021
Hearing Site: Portland, Oregon
Respondent Firm: Securian Financial Services, Inc.
Claimant Representative: Ben Winograd, J.D. and Zachary Morse, J.D.


Case Objective:

A Portland-based advisor with a Form U5 termination disclosure from more than two decades earlier sought FINRA expungement of the mark from his CRD and BrokerCheck records.


Case Summary:

Eighteen months into his financial services career, a dually-registered advisor considered moving on from his first broker-dealer and RIA, after the BD firm repeatedly missed payroll. He resigned and joined a new BD. About two months later, due to a dispute between the former BD and RIA involving a canceled contract with a life-insurance company, an investigation was launched over allegations that the advisor’s former supervisor and his employees had improperly shared commissions.

The NASD then investigated the events surrounding the advisor’s departure from the BD and the commission-sharing allegations. Although the NASD found that the advisor had not been involved with any improper commission sharing, and it took no action, the advisor still ended up with internal investigation and termination disclosures on his CRD record.


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.


Result:

The FINRA Arbitrator considered the events and testimony, as presented at the FINRA expungement hearing. He determined that “the allegations have no basis in fact” and “were entirely erroneous and unfounded,” that they were therefore per se defamatory and that they must be removed from the advisor’s records.

The Arbitrator specifically mentioned that “it is undisputed that [the advisor] was not involved with any improper commission sharing during his employment” with the BD and stated that the expungement of the disclosure is a “remedy [which] corrects a grave injustice that occurred as a result of sloppy investigatory processes and a failure to conduct basic due diligence.”

The advisor will now have a pristine BrokerCheck profile and a CRD record free of any disclosures.




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