Florida Broker Fined, Suspended for Unreported Private Securities Transactions
Recently, the Financial Industry Regulatory Authority (FINRA) announced that it was issuing a $10,000 fine and a three-month suspension against registered securities broker Gabriel William Hynes (CRD #3152541). Mr. Hynes was most recently employed at NYLIFE Securities LLC, and he worked out of a branch that was located in St. Augustine, Florida. According to FINRA investigators, Mr. Hynes engaged multiple undisclosed private securities transactions, in direction violation of industry regulations. Here, our Miami FINRA arbitration attorneys explain the allegations against this registered financial advisor.
Undisclosed Private Securities Transactions
FINRA investigators determined that broker Gabriel William Hynes participated in at least four unreported private offerings. These offerings were executed between the years of 2008 and 2014, and they were conducted outside of the scope of his employment with his member firm. The total value of these private securities transaction was in excess of $90,000. In early 2014, Mr. Hynes opened up a brokerage account with a different broker-dealer, while still being associated with NYLIFE securities. He did not inform the compliance department of his member of this fact. At this time, Mr. Hynes deposited the securities purchased through the unreported private offerings into this account. This too was done without making any of the required financial disclosures.
Understanding FINRA Rule 3210 (NASD Rule 3050)
The conduct in this case was a direct violation of NASD Rule 3050. That rule was in effect at the time that the misconduct first occurred. That rule has now been superseded by FINRA Rule 3210. FINRA Rule 3210 is a critically important securities industry regulation. It requires brokers to disclose their personal financial conduct within the industry. When individual investment advisors fail to live up to their obligations under this regulation, it puts investors at serious financial risk. Full disclosures are a must, otherwise individual investors will not be able to trust their representatives.
Brokerage Firms are Responsible for Their Representatives
Notably, this rule puts the onus on brokerage firms to perform basic oversight on their representatives. This is important because investors can hold brokerage firms liable for the misconduct of individual financial advisors. If you worked with a financial advisor at a brokerage firm, and that advisor gave you poor guidance, whether by recommending unsuitable investments, failing to diversify your holdings, or through any other type of fraud or negligence, their employer can be held financially liable for your losses. FINRA member firms have an obligation to conduct proper oversight over their advisors, ensuring the full protection of their clients.
Contact Our Experienced Miami Investment Fraud Attorneys
At Carlson & Associates, P.A., our Florida FINRA arbitration attorneys have extensive experience handling claims of broker misconduct, including those involving private securities transactions. If you lost money due to the negligence of a broker or brokerage firm, please call us now at 1-(305)-372-9700 to set up your confidential case review. We are proud to represent investment fraud victims in Miami and throughout the state of Florida.