Stifel Financial Settles with FINRA Over Advisor Supervision Failures
From the desk of Jim Eccleston at Eccleston Law
Stifel Financial has settled with FINRA, agreeing to a censure and a nearly $460,000 payment to resolve allegations of inadequate supervision of two advisors, as detailed in an Acceptance, Waiver, and Consent (“AWC”) finalized recently.
According to AdvisorHub, the settlement includes a $400,000 fine and almost $60,000 restitution to customers affected by one advisor's high-risk trading activities.
FINRA highlighted Stifel's failure to establish a proper supervisory system between 2014 and 2021 for monitoring advisors with power of attorney over customer funds. Additionally, the firm neglected to address warning signs related to another advisor's unsuitable trading strategy.
One advisor, now barred from the industry, misappropriated $105,000 by writing checks from a customer's account to himself. The second advisor, later barred, engaged in high-risk options trades for clients, resulting in significant losses, including an 80 percent loss for a retired schoolteacher. The advisor also sold stocks in a failing company to other clients, resulting in losses exceeding $53,000.
Although FINRA did not disclose their identities, AdvisorHub reports that the details align with the records of former Stifel brokers Steven D. Rodemer and Matthew A.
Perry, both subsequently barred by FINRA.
Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.
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