Jeffrey D. Noard, of Milwaukee, Wisconsin, a stockbroker formerly registered with Allied Beacon Partners, Inc., has been fined and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity pursuant to a National Adjudicatory Council Decision containing findings that he made unsuitable investment recommendations to customers. In the Matter of Department of Enforcement v. Jeffrey D. Noard, No. 2012034936101 (May 12, 2017).
According to the Decision, an eighty-two-year-old widower, JD, received recommendations by Noard to buy GWG Holdings, Inc. renewable secured debentures. Apparently, GWG Holdings, Inc., a corporation headquartered in Minnesota, operated in the life settlement industry, wherein the firm bought life insurance policies for less than their face values from willing customers in return for obtaining the policy’s death benefit upon the death of the insured.
Apparently, JD made a $20,000.00 investment in GWG pursuant to Noard’s recommendations. FINRA’s Hearing Panel ultimately concluded that Noard’s recommendation was not suitable for JD when considering the needs, investment objectives and financial profile which Noard communicated to Noard; JD intended on investing on a low risk basis in income producing investments. As a result, the Hearing Panel found Noard’s conduct violative of FINRA Rules 2010 and NASD Rule 2310.
The National Adjudicatory Council affirmed the Hearing Panel’s Decision, finding that the products which Noard recommended to JD contained substantial risk. Particularly, the National Adjudicatory Council noted that GWG was recommended by Noard during a period in which GWG had a short business history, incurred net losses in operations, and could not maintain operations without the ability to procure future capital contributions. Noard was additionally cited for overconcentrating the customer’s funds in the GWG investment and for recommending the product to someone who did not meet the standards for suitability identified in GWG’s offering materials.
The National Adjudicatory Council additionally stated that the risks of investing were not properly communicated by Noard to JD, or were otherwise downplayed by Noard to JD. Evidently, Noard did not take steps to ensure that JD could assume the risks of investing. Further, Noard reportedly made assumptions concerning JD’s financial profile which were never verified as accurate. As a result, the National Adjudicatory Council affirmed that Noard’s conduct was violative of FINRA Rules 2010 and 2310.
FINRA Public Disclosure reveals that Noard has been associated with ten different broker dealers, one of which has been expelled by securities regulators for violation of federal securities laws or is otherwise defunct. Noard is currently associated with Cabot Lodge Securities LLC.
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