South Florida Arbitration & Litigation Lawyer Blog
FINRA Unsuitable Transaction Arbitration Attorney, Russell L. Forkey, Esq.
September, 2011:
Richard Harold Byerly (CRD #848070, Registered Representative, Chester Springs, Pennsylvania) submitted an Offer of Settlement in which he was suspended from association with any FINRA member in any capacity for two years and ordered to pay $30,000 in partial restitution to customers. In light of Byerly’s financial status, no fine was imposed. Without admitting or denying the allegations, Byerly consented to the described sanctions and to the entry of findings that he engaged in unsuitable, excessive trading in elderly customers’ accounts. The findings stated that the customers were retirees with conservative investment objectives living on fixed incomes who suffered collective losses of approximately $390,000 during the period of excessive trading. The findings also stated that Byerly recommended and effected the transactions without having reasonable grounds for believing that such transactions were suitable for the customers in view of the size and frequency of the transactions, the transaction costs incurred, and in light of the customers’ financial situations, investment objectives and needs. The findings also included that Byerly exercised discretion in these accounts as well as in other customers’ accounts without the customers’ written authorization or his member firm’s written acceptance of the accounts as discretionary; his firm did not permit discretionary accounts.
FINRA found that Byerly continuously misrepresented to his firm on annual compliance questionnaires over a three-year period that he did not maintain any accounts in which he had exercised discretion. FINRA also found that in response to a written FINRA request seeking information regarding a customer complaint, Byerly submitted a letter to FINRA in which he falsely misrepresented that he had received the customer’s prior approval for all trades in the customer’s account. The suspension is in effect from August 1, 2011, through July 31, 2013. (FINRA Case #2009017492201).