Stifel Nicolaus & Company Stockbroker Barred for Obstructing Investigation
Andrew Lyman Quinn of Reno, Nevada, a stockbroker with Stifel, Nicolaus & Company, Inc., was permanently barred from associating with any Financial Industry Regulatory Authority (FINRA) member firm in any capacity in connection with a Hearing Panel Decision containing findings that Quinn failed to respond to FINRA’s requests for information in connection with an investigation into Quinn’s borrowing of funds from a customer without firm approval. Department of Enforcement v. Quinn, No. 2013038136101 (Oct. 23, 2015).
According to the Decision, Quinn was formerly a registered securities broker with Wells Fargo Advisors, LLC and later Stifel, Nicolaus & Company. The Decision stated that while he was at each firm, Quinn had borrowed money from one of his customers, LZ, in violation of NASD and FINRA Rules. Quinn reportedly acquired LZ as a customer in 2008, who was seventy years old at the time. In May 2009, Quinn had begun borrowing from LZ which eventually amounted to $64,000 via eight transactions. The Decision indicated that in each case, Quinn would direct the client to transfer her funds from her Wells Fargo securities account to her checking account and issue Quinn a check for the proceeds.
Quinn, according to the Decision, did not make required quarterly payments under a May 12, 2010 promissory note. As a result, in April 2014, LZ had complained to Wells Fargo about Quinn not repaying the loan, prompting Wells Fargo to settle her issue in August 2014 for $25,000.00. At the time that Quinn borrowed the funds from LZ, the firm had a policy which prohibited individuals such as Quinn from borrowing funds from a customer unless the customer was an immediate family member and the loan was made for non-securities purposes. Quinn’s loan, according to FINRA, did not fall into either of the firm’s categories which allowed for the loan.
Further, the Decision indicated that Quinn would eventually move on to Stifel Nicolaus, where he took LZ’s account with him and borrowed an additional $3,000.00. Quinn did not repay such loan. Similar to the aforementioned reaction, LZ complained to Stifel Nicolaus, who later settled with the client for $3,000 on July 31, 2014. Stifel Nicolaus, via the firm’s written procedures, also prohibited Quinn’s borrowing conduct. Quinn reportedly concealed the conduct from his firm’s compliance department, falsely denying having borrowed funds from a customer in an annual employee certification from February 15, 2011.
LZ reportedly filed an investor complaint with FINRA after Quinn failed to repay the loan. FINRA began their investigation into Quinn’s allegations as a result. In connection with the investigation, pursuant to Rule 8210, FINRA had requested that Quinn provide information concerning the nature of the loans; however, Quinn never responded to FINRA’s requests. Consequently, on May 20, 2015, FINRA had launched a Complaint against Quinn, containing charges that Quinn borrowed money from LZ in violation of NASD and FINRA rules, engaged in inequitable business conduct by submitting a false compliance questionnaire to Stifel Nicolaus, and failed to respond to multiple requests for information pursuant to Rule 8210. The Decision indicated that Quinn provided an Answer to the Complaint on July 7, 2015, where he admitted to each allegation in the Complaint and waived a right o a hearing.
Firms and individuals, not surprisingly, are prohibited from unauthorized use of customer funds, borrowing of a customer’s securities or funds, forgery, non-disclosures or misstatements of material facts, and various deceptions and manipulations. Such conduct can also be found to violate criminal and other civil laws, and be subject to sanction from the federal and state government bodies.
FINRA Stockbrokers like Quinn who do not cooperate with FINRA’s investigations often face a permanent bar from practicing in the securities industry as such lack of cooperation violates FINRA’s Rule 8210 – requiring that no member or person shall fail to provide information or testimony or permit an inspection and copying of books, records, or accounts pursuant to the rule. FINRA typically accompanies a Rule 8210 violation with a Rule 2010 violation when individuals, according to FINRA, do not appear to observe high standards for commercial honor and just and equitable principles of trade.
The Hearing Panel actually concluded that Quinn’s borrowing violations merited a $20,000 and two-year suspension in all capacities, and that his submission of a false compliance certification merited a $10,000 fine and six-month suspension. Such fines and suspensions were declined in light of his permanent bar as a result of violating Rules 8210 and 2010 for obstructing FINRA’s investigation.
Public disclosure records via FINRA’s BrokerCheck reveal that Quinn has been subject to six disclosure incidents. On April 15, 2011, Quinn was subject to a $56,942.00 civil judgment/lien. On January 04, 2012, Quinn was subject to a bankruptcy action. On August 6, 2012, Quinn was subject to a $19,766.26 tax judgment/lien. On October 8, 2012, he was subject to a $649.52 civil judgment/lien. On April 7, 2014, the aforementioned client, LZ, settled the claim involving Quinn for $25,000.00.
Guiliano Law Group
If you have been the victim of securities fraud and you have a complaint, you should consult with an attorney. The practice of Nicholas J. Guiliano, Esquire, and The Guiliano Law Group, P.C., is limited to the representation of investors in claims for fraud in connection with the sale of securities, the sale or recommendation of excessively risky or unsuitable securities, breach of fiduciary duty, and the failure to supervise. We accept representation on a contingent fee basis, meaning there is no cost unless we make a recovery for you, and there is never any charge for a consultation or an evaluation of your claim. For more information contact us at (877) SEC-ATTY.