FINRA Charges Allstate Stockbroker With Conversion
Jesse Gil III of Corpus Christi Texas a stockbroker formerly registered with Allstate Financial Services LLC has been charged by Financial Industry Regulatory Authority (FINRA) Department of Enforcement in a Complaint containing accusations that (1) Gil converted funds belonging to an elderly widow whom Gil advised outside Allstate Financial Services’ auspices (2) Gil failed to procure permission from Allstate Financial Services to be designated as the individual’s attorney-in-fact (3) Gil engaged in outside business activities that had not been approved by the firm and (4) Gil failed to fully cooperate with a FINRA investigation into allegations of his misconduct. Department of Enforcement v. Jesse Gil Disciplinary Proceedings No. 2016051814301 (Aug. 26, 2019).
According to the Complaint, Gil and an elderly widow, FC, met in 2014 around which time Gil was asked to assist FC with managing the financials concerning FC’s late husband. Gil allegedly assisted FC throughout the period he was associated with Merrill Lynch and Allstate, however, the accounts which FC affected were at Bank of America – Merrill Lynch’s affiliate who Gil also worked for. The Complaint alleged that Gil, among other things, effected withdrawals, fund transfers and deposits in Gil’s capacity as a Bank of America employee. He was allegedly compensated for his activities by FC.
FINRA indicated that in June 2016, following Gil’s termination from Merrill Lynch, he steered FC into allowing him to access FC’s Bank of America credit accounts and for Gil to be issued a Bank of America credit card. FINRA Department of Enforcement alleged that Gil induced FC to agree to Gil’s requests by falsely claiming that the bank’s policies required it in order for Gil to provide FC assistance.
FINRA alleged that in 2016, when Gil became employed by Allstate Financial Services LLC, he became designated as FC’s attorney-in-fact even though this was prohibited by Allstate. The Complaint alleged that the attorney-in-fact designation was never made known to Allstate by Gil. Gil allegedly accessed FC’s accounts to initiate transfers of her funds to Gil for the financial services that Gil provided to her.
FINRA Department of Enforcement alleged that from July 30, 2016 to August 20, 2016, Gil tapped two of the credit cards in FC’s name to pay Gil’s expenses. Gil also allegedly used FC’s credit accounts to fund his international trips and to purchase retail items. According to the Complaint, Gil executed so many suspicious transactions generating fraud alerts that it drove FC to Bank of America where she complained that there were unauthorized transactions being effected on her accounts. The Complaint alleged that Gil was never authorized by FC to use the account for his own benefit.
FINRA alleged that Gil violated the policies of Allstate and Merrill Lynch by engaging in undisclosed activities. Merrill Lynch reportedly disallowed stockbrokers from engaging in activities absent the stockbroker’s written notification to the firm – and Merrill Lynch disallowed stockbrokers from earning compensation from those outside activities. Allstate’s procedures and policies also mandated disclosure of outside business activities. Allegedly, Gil falsified information to Merrill Lynch and Allstate about his outside business activities when submitting compliance questionnaires or certifications.
FINRA Department of Enforcement also alleged that Gil neglected to fully cooperate with FINRA’s investigation into his activities. The Complaint indicated that Gil only partially responded to a FINRA request in May of 2019 and that was after he was already provided additional time from FINRA to respond. Allegedly, Gil was made aware that his response to FINRA was deficient and that he was required to cure that deficiency by May 29, 2019 but he still failed to provide all the information and documentation that FINRA requested. FINRA Department of Enforcement alleged that Gil’s conduct was violative of FINRA Rules 2010, 3270, and 8210.