Colin Edward Hammer, of Akron, Ohio, a stockbroker registered with Morgan Stanley, has been fined $2,500.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity by consenting to findings that he placed unauthorized trades in customer accounts. Letter of Acceptance, Waiver and Consent, No. 2016051154701 (Jan. 22, 2018).
According to the AWC, in 2012, two customers established fee-based Consulting Group Advisory accounts with Hammer during the time he was associated with Morgan Stanley. The AWC stated that the Consulting Group Advisory accounts were designed as non-discretionary, so the rebalancing of asset allocations and other transactions had to be authorized by customers on days in which transactions were executed.
The AWC stated that the customers initially instructed Hammer to invest their funds according to two of the model portfolios which had been recommended to them. Evidently, from January of 2013 to May of 2016, Hammer effected transactions to conform with the model portfolios while rebalancing customer accounts; however, he failed to communicate with customers and procure their approval on the days that he placed trades in their accounts. Moreover, the customers never furnished any written authorization to Hammer enabling him to exercise discretion in their investment accounts. As a result, FINRA found that Hammer’s conduct was violative of FINRA Rule 2010 and NASD Rule 2510(b).
FINRA Public Disclosure confirms that Hammer has been referenced in four customer initiated investment related disputes pertaining to allegations of his violative conduct during the period that he was associated with Morgan Stanley. Particularly, on August 26, 2009, a customer filed an investment related written complaint involving Hammer’s conduct, in which the customer sought $17,976.79 in damages based upon accusations that Hammer placed purchases of mutual funds in the customer’s investment account without the customer’s consent.
Subsequently, on November 18, 2015, a customer filed an investment related written complaint involving Hammer’s conduct, alleging that a purchase of an annuity had been arranged for the customer even though it was not appropriate based on the inability for the annuity to be transferred or liquidated as well as the failure for the annuity to be classified as Medicaid-complaint.
On September 26, 2016, another customer filed an investment related written claim pertaining to Hammer’s activities, alleging that between December of 2012 and April of 2016, mutual fund, stock and corporate debt transactions had been effected in the customer’s account that were not suitable for the customer. Moreover, a customer initiated investment related arbitration claim in reference to Hammer’s conduct was settled for $225,000.00 in damages founded on allegations that between 2010 and 2016, unsuitable stock transactions were placed in the customer’s investment portfolio. FINRA Arbitration No. 16-02103 (Sept. 19, 2017).
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