FINRA Fines Cetera Stockbroker For Unauthorized Trading

Martin Earl Brooks of Belton Missouri is a stockbroker formerly registered with Cetera Advisors LLC who has been fined $5,000.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity by consenting to findings that he effected trades in customer accounts without their written authorization and mismarked order tickets as having been unsolicited when they were actually solicited. Letter of Acceptance Waiver and Consent No. 2016049674301 (Mar. 16, 2018).

According to the AWC, while Brooks was associated with Cetera Advisors LLC, he was subject to the firm’s procedures and policies, which disallowed stockbrokers from effecting securities purchases or sales in the accounts of Cetera customers on a discretionary basis unless the customer had provided written authorization.

Nonetheless, the AWC revealed that on April 5, 2016, Brooks exercised discretion in the accounts of five Cetera Advisors LLC customers, where he executed purchases of shares in a real estate fund in each of the customers’ accounts. Evidently, Brooks failed to procure written authorization from customers before effecting transactions in their accounts. In addition, the customers’ accounts had not been approved by Cetera Advisors LLC for trades to be effected on a discretionary basis. Consequently, FINRA found that Brooks’ conduct was violative of FINRA Rule 2010 and National Association of Securities Dealers (NASD) Rule 2510(b).

The AWC also stated that while Brooks was associated with Cetera Advisors LLC, he was subject to the firm’s policies which required that trades be marked as solicited and noted as being placed with discretion when those trades were indeed discretionary. However, on April 5, 2016, Brooks reportedly mismarked the order tickets for the purchases of shares in a real estate fund in each of the customers’ accounts. Brooks reportedly claimed that the trades were not solicited and did not identify the trades as discretionary. The AWC stated that Brooks caused his firm to establish and maintain inaccuracies in the firm’s records and books in violation of Securities Exchange Act of 1934 Section 17(a) and Rule 17-a. As a result, FINRA found Brooks’ conduct violative of FINRA Rules 2010 and 4511.

FINRA Public Disclosure reveals that a customer initiated investment related written complaint involving Brooks’ conduct was settled on July 27, 2017 for $490,000.00 in damages based upon accusations of unsuitability concerning the customer’s direct investment product purchases while Brooks was associated with Cetera Advisors LLC.

Brooks was fired by Cetera Advisors LLC on April 15, 2016, supported by allegations that Brooks made unsuitable investment recommendations to a Cetera Advisors LLC customer. Since July 18, 2016, Brooks has been associated with United Planners’ Financial Services of America.

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