South Florida Arbitration & Litigation Lawyer Blog
April 2011 FINRA Account Executive Enforcement Action:
Linda Louise Johnson (CRD #4287779, Registered Representative, Roscoe, Illinois, formerly licensed with Associated Investment Services, Inc.) submitted a Letter of Acceptance, Waiver and Consent in which she was fined $5,000 and suspended from association with any FINRA member in any capacity for six months. The fine must be paid either immediately upon Johnson’s reassociation with a FINRA member firm following her suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. Without admitting or denying the findings, Johnson consented to the described sanctions and to the entry of findings that she affixed the signatures of members of the public on documents to open a joint account and transfer mutual fund shares into the account, without their knowledge and consent, and submitted the forms to her member firm for processing. The findings stated that Johnson had a registered sales assistant execute a “Signature Guarantee” for the customers’ signatures on the account transfer forms, based on Johnson’s representation to the assistant that she witnessed the customers sign the documents, which she knew was not true. The findings also stated that during all relevant times, Johnson’s firm had a policy which prohibited representatives from signing documents or requesting anyone to sign documents on another person’s behalf, even if that person gave permission to do so. The findings also included that Johnson affixed one of the customer’s signature on a Letter of Instruction, which directed a member firm to sell $25,000 worth of the mutual fund that the customer owned, and forward the proceeds to Johnson. FINRA found that while the customer authorized the transaction, Johnson affixed the customer’s signature to the document without the customer’s knowledge or consent, and bypassed her firm’s internal procedures requiring its operations department to review the document prior to submission to the mutual fund. FINRA also found that Johnson altered portions of an Individual Retirement Account (IRA) Distribution Request Form that another customer had completed by changing the date and dollar amount on the form; she then submitted the altered form for a distribution of funds. In addition, FINRA determined that while the customer authorized the distribution of funds, Johnson altered the form without the customer’s knowledge and consent. The suspension is in effect from March 7, 2011, through September 6, 2011. (FINRA Case #2010021494801).
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