Alleged Unauthorized Trading and Texting Violations Lead to Suspension for Joseph Warner Rozof

The Financial Industry Regulatory Authority (FINRA) sanctioned Joseph Warner Rozof (CRD No. 5274784) for engaging in unauthorized discretionary trading and using unapproved communication channels to conduct securities business. FINRA found that between April 2022 and May 2024, Rozof placed more than 250 discretionary trades in the brokerage accounts of two customers without obtaining their written authorization or firm approval, in violation of FINRA Rules 3260(b) and 2010.

FINRA also alleged between March 2022 and June 2024, Rozof used his personal cell phone to exchange business-related text messages with customers and colleagues, preventing his firm from preserving required records, in violation of FINRA Rules 4511 and 2010. Rozof consented to a 45-day suspension and a $10,000 fine for these violations.

Rozof entered the securities industry in 2007 and was most recently registered as a General Securities Representative with Harley Capital LLC (CRD No. 310046) from March 2022 until July 2024, when the firm discharged him for violating FINRA Rule 3260. Although he is not currently associated with any FINRA member firm, he remains subject to FINRA’s jurisdiction.

Under FINRA Rule 3260(b), brokers may not exercise discretionary authority over a client’s account without written authorization from the client and written acceptance of the account by the firm. Unauthorized discretionary trading occurs when a broker executes trades without prior client consent for each transaction. Rule 4511 requires firms—and their representatives—to preserve all business-related communications for regulatory review. Using personal devices for client communications outside firm-approved systems can prevent firms from meeting these recordkeeping obligations and constitutes a violation.

According to FINRA, Rozof placed over 250 trades in the two customer accounts without obtaining specific approval for each transaction. While he discussed general strategies with his clients, he did not confirm the individual trades before executing them. Additionally, Rozof used his personal cell phone to communicate with 27 customers and other firm employees about securities transactions and fund transfers. These messages were not captured or stored by the firm’s compliance system, resulting in incomplete records of business-related communications.

FINRA determined that Rozof’s conduct breached both the authorization and recordkeeping rules, undermining client protection and firm supervision. He was fined and suspended accordingly, with the sanctions effective upon FINRA’s acceptance of the settlement in August 2025.

Lufrano Law, LLC is a national investment litigation firm and has experience representing investors who have investment disputes with brokers and broker-dealers. Please contact us at (800) 627-2179 for more information if you have been the victim of investment negligence or fraud.

The content on this site reflects personal opinions and does not constitute statements of fact. No findings have been made against the firms or individuals mentioned. This blog is intended solely for educational purposes, drawing on publicly available information to provide general insights and a basic understanding of the law. It is not a substitute for legal advice.