South Florida Arbitration & Litigation Lawyer Blog
Variable Annuity Unsuitably FINRA Arbitration and Litigation Attorney, Russell L. Forkey, Esq.
January, 2012:
Dennis Stanley Kaminski (CRD #1013459, Registered Principal, Wellington, Florida) was fined $50,000, suspended from association with any FINRA member in any capacity for 18 months and required to requalify before acting in any capacity requiring qualification. The Securities and Exchange Commission (SEC) sustained the sanctions following appeal of the NAC decision. The sanctions were based on findings that Kaminski failed to supervise the timely review of his member firm’s variable annuity trades. The findings stated that Kaminski not only failed to follow up to ensure the variable annuity supervisor and head of the firm’s compliance department properly exercised his delegated authority, he also failed to heed numerous warnings of staff deficiencies in the compliance department. Kaminski also ignored many red flags that should have caused him to question the abilities of the supervisor and head of the firm’s compliance department, and whether the compliance department had adequate resources to oversee the firm’s expanding business. The supervisor and head of the firm’s compliance department warned Kaminski that the compliance department was severely understaffed, and he and another individual expressed their concern to Kaminski that important surveillance work was falling behind, and sent alarming emails and memoranda regarding the inability of the compliance department’s Trade Review Team (TRT) to timely complete its work. The findings also stated that Kaminski attempted to conceal the firm’s supervisory problems from FINRA’s investigators. Kaminski did not disclose that the firm had halted its daily review of the Red Flag Blotter during a meeting with FINRA staff. Kaminski also misrepresented to FINRA staff that the firm had already developed and implemented a monthly trend report to track client accounts that had been subject to two or more 1035 exchanges during the prior 12 months.
The suspension is in effect from December 19, 2011, through June 18, 2013. (FINRA Case EAF0400630001).