FINRA’s Department of Enforcement investigated Richard’s conduct and alleged he engaged in an outside business activity. Specifically, from November 2007 through December 2011, Richards was appointed and served as co-executor of a customer’s estate. In addition, Richards received approximately $10,000 in compensation for his services as co-executor of the estate. According to FINRA, Richards did not provide written notice to NOC that he was serving as co-executor.
Based upon the foregoing misconduct, FINRA alleged Richards violated FINRA Rules 3270 and 2010, as well as NASD Conduct Rules 3030 and 2110. FINRA Rule 3270 states in relevant part:
No registered person may be an employee, independent contractor, sole proprietor, officer, director or partner of another person, or be compensated, or have the reasonable expectation of compensation, from any other person as a result of any business activity outside the scope of the relationship with his or her member firm, unless he or she has provided prior written notice to the member, in such form as specified by the member.
Here, Richards served as co-executor of a customer’s estate for which he received compensation outside the scope of the relationship with NPC. Further, in August 2010, Richards falsely represented to NPC in a compliance questionnaire that he had previously disclosed to the Firm all outside business activities and that he had not acted as an executor of an estate.
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 suffered investment damages investing with Richards while he was employed by NPC, 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 or contact one of our attorneys at (800) 627-2179 to schedule a free consultation.