Hornor Townsend Stockbroker Sanctioned For Selling Away
Micah Wesley Patterson (also known as Wes Patterson) of Layton Utah a stockbroker formerly registered with Hornor Townsend Kent LLC has been fined $5,000.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon findings that Patterson engaged in an unapproved private securities transaction during the time that he was associated with MML Investors Services and Hornor Townsend Kent LLC. Letter of Acceptance Waiver and Consent No. 2019062875201 (June 23, 2020).
According to the AWC, an investor had been solicited by Patterson to invest in Future Income Payments LLC which was purportedly in the business of structured cash flow investments. The AWC indicated that investors were typically offered a seven-to-eight percent return on their Future Income Payments investment. At least one investor was sold $30,644.00 in a Future Income Payments Purchase Agreement by Patterson.
FINRA stated that there was no point in which Patterson inquired with MML Investors Services or Hornor Townsend Kent in regard to his outside transaction. He was never provided authorization from his securities broker dealer employers to effect sales of Future Income Payments LLC to customers. FINRA noted that Patterson was also administered a compliance questionnaire by Hornor Townsend Kent in which he claimed not to have been involved in a private securities transaction. FINRA determined that Patterson’s activities were violative of FINRA Rules 2010 and 3280.
The AWC stated that Future Income Payments shut down in April of 2018 by which time it owed $300,000,000.00 in payments to investors. That company and its owner Scott A. Kohn have since been criminally charged with committing mail fraud and wire fraud.
FINRA reveals that Patterson has been identified in two additional customer initiated investment related disputes concerning accusations of his misconduct when the stockbroker was employed by MML Investors LLC. On November 19, 2018, a customer filed an investment related complaint in reference to Patterson’s conduct where the customer sought $30,000.00 in damages based upon accusations that the MML Investors Services customer was sold bad structured products by Patterson. The complaint alleges that the customer was placed into structured cash flow products without due diligence being undertaken on the risks.
Another customer initiated investment related arbitration claim involving Patterson’s conduct was settled to resolve allegations of bad investment recommendations as it pertained to the customer’s purchase of Future Income Payments. FINRA Arbitration No. 20-00433 (May 29, 2020). The claim alleges that a contract had been breached and that a fiduciary duty that was owed to the customer had been violated in regard to the sale of this structured product as well as an indexed universal life insurance policy that Patterson sold the customer in 2017. According to the claim, FINRA and NASD rules were violated.
Patterson was terminated by Hornor Townsend Kent on June 5, 2020 founded on him being sanctioned by FINRA for selling away from the securities broker dealer.