Carol Ann Holesha of Chicago Illinois a stockbroker formerly registered with LPL Financial LLC has been fined $7,500.00 and suspended for five months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that (1) Holesha borrowed money from a customer without the firm’s permission and (2) Holesha made misleading representations to LPL Financial when questioned about her borrowing activities. Letter of Acceptance Waiver and Consent No. 2018059481701 (Nov. 15, 2018).
According to the AWC, during the time that Holesha was associated with LPL Financial, she was disallowed from borrowing from other persons absent the firm making an exception. Apparently, an elderly investor, DF, maintained brokerage accounts at the firm, and Holesha was assigned to DF’s account. The AWC stated that $125,000.00 was then been borrowed by Holesha from DF so that Holesha could buy real estate.
Evidently, no documents or promissory note had been drafted to evidence that loan arrangement between Holesha and DF. Plus, Holesha apparently never detailed how and when DF’s funds would be repaid or what interest DF would receive by lending Holesha the funds. Rather, Holesha simply orally confirmed with DF that Holesha would repay DF’s money.
According to the AWC, LPL Financial was not given information from Holesha about Holesha’s borrowing arrangement. Moreover, there was no exception that Holesha sought from LPL that would warrant her borrowing money from the customer. Holesha purportedly concealed from LPL Financial that she was violating the firm’s rules – no approval was ever provided to Holesha by LPL Financial before DF provided Holesha with funds. Consequently, FINRA found Holesha’s conduct violative of FINRA Rules 2010 and 3240.
FINRA Public Disclosure confirms that Holesha is subject of a customer initiated investment related arbitration claim where the customer was awarded $70,819.00 in damages based upon Holesha having been found liable on the customer’s claims of fraud, negligence, violation of National Association of Securities Dealers (NASD) Rules, and violation of Securities Exchange Act of 1934 Section 10(b) and Rule 10(b)5 in reference to Holesha recommending unsuitable investments to the customer, effecting purchases of illiquid and speculative real-estate based limited partnerships, and making misrepresentations to the customer concerning the investments. NASD Arbitration No. 93-00797.
Holesha was discharged by LPL Financial on July 21, 2018 supported by accusations that Holesha violated company policy by borrowing customer funds.
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