FINRA Charges MML Broker With Hindering Investigation
Tyler James Woodward of Colorado Springs Colorado a stockbroker formerly registered with MML Investors Services LLC has been charged by Financial Industry Regulatory Authority (FINRA) Department of Enforcement in Complaint alleging that Woodward failed to cooperate in a FINRA investigation into allegations that he converted a customer’s funds. Department of Enforcement v. Tyler J. Woodward Disciplinary Proceeding No. 2018058866401 (Oct. 4, 2018).
According to the Complaint, on October 13, 2016, FINRA was notified through MML Investor Services’ Form U5 submission that Woodward had been terminated by the firm founded on accusations that he did not abide by MML’s procedures and policies. The Complaint alleged that by October 19, 2016, the Form U5 submitted by MML was amended to reflect that Woodward had been investigated by the firm for complaints from customers in regards to Woodward’s traditional life insurance sales practices.
MML then apparently indicated to FINRA on October 17, 2017 that the investigation into Woodward’s activities had concluded, and that the customers’ issues had been addressed. The Complaint alleged that between August 17, 2016 and March 6, 2018, there were a total of eight customer initiated investment related complaints that had been filed in reference to Woodward’s alleged misconduct.
According to the Complaint, Woodward had been under investigation by FINRA in June 18, 2018, after customer KJ complained about Woodward’s activities. KJ alleged that Woodward steered the customer into transferring more than $117,000.00 from the MML Investors Services account into accounts held away from the firm. The Complaint stated that KJ’s money was ultimately moved to Precision Financial Research and Management LLC – a non-registered broker-dealer that Woodward established. There, Woodward reportedly attained access to KJ’s investment account holdings, and traded in the customer’s account on a discretionary basis. Critically, Woodward was alleged to have ignored a number of KJ’s attempts to have KJ’s money returned, causing KJ to complain to FINRA regarding Woodward’s conduct.
The Complaint then revealed that on June 25, 2018, Woodward was sent a letter from FINRA seeking documentation and information from Woodward concerning his activities with KH. The Complaint stated that the documentation and information requested by FINRA under Rule 8210 was due by July 11, 2018. Woodward apparently neither honored FINRA’s request nor sought any extension of time to cooperate.
FINRA allegedly sent another letter to Woodward seeking the documentation and information outlined in FINRA’s first request. As was the case with the first request, FINRA was apparently unable to deliver the letter. In addition, FINRA was apparently unable to reach Woodward by phone or e-mail. The Complaint stated that Woodward did not respond to FINRA’s request, nor did he attempt to obtain another extension.
According to the Complaint, FINRA sent Woodward an additional letter on August 6, 2018 seeking his recorded testimony in reference to the allegations cited by KJ; however, FINRA’s letter had been returned because it was not deliverable. Eventually, on August 7, 2018, a letter was sent by FINRA to Woodward that Woodward apparently signed as having been received. Nevertheless, Woodward failed to inform FINRA about whether he would appear for recorded testimony on August 15, 2018; he was ultimately a no-show. Another attempt to procure Woodward’s testimony was made by FINRA but to no avail. Consequently, FINRA stated that Woodward’s failure to both testify and provide documentation and information constituted separate violations of FINRA Rules 2010 and 8210.
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