Alexander P. Brown, III, of Baltimore, Maryland, a stockbroker with Chaplin Davis, was fined $2,500.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity after consenting to findings that he engaged in unauthorized discretionary trading in customer accounts. Letter of Acceptance, Waiver and Consent, No. 2015047883501 (July 22, 2016).
According to the AWC, from May 2015 through October 2015, Brown was found to have engaged in twenty-eight trades on a discretionary basis in the account of a customer, despite not having the customer’s written authorization. The AWC stated that the firm had not approved the customer’s account to be discretionary.
FINRA found that Brown’s conduct was violative of NASD Rule 2510(b) and FINRA Rule 2010 due to Brown’s engaging in discretionary trading in a customer’s account without first gaining the customer’s written consent and the firm’s approval for the account to be deemed discretionary.
Public disclosure records reveal that Chaplin Davis terminated Brown amid allegations that Brown did not follow the firm’s protocol regarding designating an account as deceased. The firm additionally alleged that Brown’s limited written trading authorization persisted after Brown learned of an account holder’s death.
Public disclosure records also reveal that on January 11, 2016, Maryland Securities Division issued a Consent Order resulting from Brown’s conduct, in which Brown received sanctions prohibiting him from exercising authority in any discretionary accounts, nor having a supervisory role or acting in a supervisory capacity.
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