State of Massachusetts Fines Broker-Dealer $100,000 for Mishandling Client Data

Posted on January 8th, 2019 at 1:59 PM
State of Massachusetts Fines Broker-Dealer $100,000 for Mishandling Client Data

From the Desk of Jim Eccleston at Eccleston Law LLC:

According to a consent order issued by the Massachusetts Securities Division, New Jersey-based Summit Equities has agreed to pay the state $100,000 for failing to supervise four registered agents, who mishandled private client information.

According to Massachusetts, from January 2013 to February 2018, four registered agents entered clients’ personal information into third-party customer relations management systems, which violated the broker-dealer’s privacy and security policies.

In its investigation, Massachusetts asserted that when these registered agents entered clients’ personal information into third-party customer relations management system, Summit Equities lost control and access over the information. The information included Social Security numbers and other personal information. Moreover, when the registered agents left to join other firms, Summit Equities lost complete control over the sensitive client information because it had measures in place to delete client information from agents’ devices but not from third-party systems.

In addition to paying the fine, Summit Equities agreed to take corrective steps to prevent third-party systems from taking control over sensitive client data and agreed to inform all of its clients in Massachusetts about the potential compromise of their private data.

The attorneys of Eccleston Law LLC represent investors and advisors nationwide in securities and employment matters. The securities lawyers at Eccleston Law also practice a variety of other areas of practice for financial investors and advisors including Securities FraudCompliance ProtectionBreach of Fiduciary DutyFINRA Matters, and much more. Our attorneys draw on a combined experience of nearly 65 years in delivering the highest quality legal services. If you are in need of legal services, contact us to schedule a one-on-one consultation today.

Related Attorneys: James J. Eccleston

Tags: james eccleston, eccleston law, eccleston law llc, eccleston, client data misuse, massachusetts securities division, summit equities, social security leak

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Jim, Stephany and the whole team were a God send.  We felt like we were put into a situation where we had no advocate. Jim’s team came in with a strong, well laid out strategy on how to get our story heard. Where our outside compliance company had no ability to help, our Broker Dealer was impenitent, and the regulators were aggressive pursuing vague rules, Jim came like a barricade against an assault we did not understand. Though you pay member dues to be affiliated with FINRA and a B/D, you have no voice. The only thing that is truly heard in this un-level playing field is a bulldog’s bark like Jim’s. I would encourage anyone to call Jim and his team to find a real ally in the tough and complicated world of securities regulation. They are truly the best.

Greg P.


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