FINRA’s Department of Enforcement investigated Bohack’s alleged misconduct and determined he failed to respond appropriately to numerous red flags indicating that registered representatives in the branch were engaging in abusive sales practice. Specifically, Bohack failed to supervise the broker’s misleading sales scripts, which contained various misrepresentations. For example, Global Arena’s brokers promised extraordinary and misleading short-term returns for junk bonds.
To make matters worse, Bohack, who was charged with supervising his employees’ trading activity, failed to detect suspicious trading patterns. For example, according to FINRA, Bohack observed brokers engaging in patterns of in-and-out trading activity in customer accounts, sometimes within the span of a week or less. Bohack also allegedly was aware of unauthorized trading by some of his brokers. Yet, Bohack took no meaningful action to curb this illicit activity.
Based upon the foregoing alleged misconduct, FINRA contends Bohack violated FINRA Rules 2010 and 3110(a). FINRA Rule 3110(a) requires member firms to establish and maintain a system to supervise the activities of each associated person that is reasonably designed to achieve compliance with applicable securities laws and regulations, and with applicable FINRA rules. Here, Bohack failed to supervise his registered representatives, thereby violating FINRA Rule 3010.
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 losses and damages investing with Global Arena, 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.