Darnell A. Deans (FINRA CRD No. 2200059) entered the securities industry in 1992 as a general securities representative. During Deans’ career he worked for several FINRA-member firms, including but not limited to: J. Gregory & Company, Inc.; Commonwealth Associates; Berekely Securities Corporation and Josephthal & Co., Inc. From January 2005 to November 2013, and during the relevant time period, Deans worked for Garden State Securities, Inc. (“Garden State”). Following Deans’ departure from Garden State he worked for John Carris Investments LLC, and he currently works for Blackbook Capital LLC.
FINRA’s Department of Enforcement is currently investigating Deans and alleges he borrowed a total of $266,000 from two of his brokerage customers without disclosing the loans to his employer. According to FINRA, from April 2011 to August 2011, Deans borrowed approximately $241,000 from one of his customers. On or about May 11, 2011, Deans borrowed an additional $25,000 from one of his other customers without disclosing the financial arrangements to Garden State as required by its policies and procedures. To make matters worse, Deans lied on firm documents, including a compliance memorandum dated January 23, 2012, when he indicated he had not borrowed any funds from customers.
The aforementioned financial arrangements between Deans and two of his brokerage customers constituted personal loans, which Dean was required to disclose to Garden State unless certain conditions were met. Nonetheless, Deans borrowed the aforementioned funds from the customers without providing written notice to Garden State. Indeed, on at least two occasions, Deans intentionally concealed the existence of the loans from Garden State. Additionally, none of the prescribed exceptions under FINRA Rule 3240 were satisfied because the customers were not related to Deans, did not have a business relationship with Deans outside the registered representative/customer relationship, and deans was not a financial institution engaged in lending.
FINRA alleges Deans violated FINRA Rule 3240, among other rules, which prohibits registered persons from borrowing money from or lending money to any customer certain conditions and/or exceptions are satisfied. A violation of FINRA Rule 3240 also constitutes a violation of FINRA Rule 2010, which requires associated persons to observe high standards of commercial honor and just and equitable principals of trade.
Lufrano Law, LLC is a national securities litigation firm and has experience representing investors who have investment disputes with brokers and broker-dealers. If you lost money investing with Deans, you may be able to recover your losses through FINRA arbitration. Our firm only receives a fee if you recover money. Please complete the contact form below or contact one of our attorneys at (800) 627-2179 to schedule a free consultation.