Alexander Jon James of Palm Beach Gardens Florida a stockbroker formerly registered with Voya Financial Advisors has been fined $10,000.00 and suspended for one year from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that he engaged in undisclosed outside business activities and private securities transactions without permission from Voya Financial Advisors. Letter of Acceptance Waiver and Consent No. 2018058026701 (Apr. 2, 2020).
According to the AWC, in January of 2013, three individuals including James had established a company that provided users a way of obtaining funds for business ventures. This company was operated by James on a daily basis. FINRA stated that during this period, Voya Financial Advisors mandated that its stockbrokers provide it with advanced notice about any outside business activities.
FINRA stated that James had been administered compliance questionnaires from Voya Financial Advisors that had been dated between 2013 and 2016 and which called upon the stockbroker to disclose his outside business activities. James falsely conveyed that all outside business activities had been disclosed. FINRA found that James’ failure to disclose the company that he was involved with to his securities broker dealer employer constituted violations of FINRA Rules 2010 and 3270.
FINRA also referenced that James engaged in private securities transactions. Between May of 2014 and May of 2015, two customers of Voya Financial Advisors had been solicited by James in regard to their investments in the company that James controlled. The AWC stated that those investors were introduced to the company by James and had been provided purchase agreements. FINRA revealed that those customers invested $667,000 in the company.
The supervisory procedures implemented by Voya Financial Advisors called for stockbrokers to procure written authorization from the securities broker dealer before engaging in private securities transactions. There was no point in which Voya Financial Advisors received notification from James regarding his sales of investments in his company to customers. Also, three of the compliance questionnaires administered to James which he completed had contained false representations as James conveyed that he reported all private securities transactions to the securities broker dealer. FINRA found that James sold away in violation of FINRA Rules 2010 and NASD Rule 3040.
FINRA Public Disclosure also reveals that a customer initiated investment related arbitration claim involving James’s conduct was settled for $75,000.00 in damages based upon allegations that customers were steered by James towards buying unauthorized outside investments in a startup company and that the customers’ assets were misappropriated. FINRA Arbitration No. 18-01041 (Oct. 4, 2018). According to the claim, the customers also alleged that they were sold unsuitable variable annuities.
James’s registration with Voya Financial Advisors was terminated on May 31, 2017. Between June 7, 2017 and March 10, 2020, he was registered with Allstate Financial Services LLC.
