selling away

David Woods Unsworth Jr. of San Francisco California a stockbroker formerly employed by National Securities Corporation has been fined $5,000.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that Unsworth engaged in private securities transactions. Letter of Acceptance Waiver and Consent No. 2016050066401 (Aug. 28, 2018).

According to the AWC, before Unsworth had commenced employment with National Securities Corporation, he made a arrangements for him and his registered investment advisory, Legend Merchant Group, Inc., to obtain 450,000 shares of stock that had been issued by a private company. Evidently, the shares were provided as payment for Unsworth’s assistance in helping the private company raise capital.

The AWC stated that during the time when Unsworth joined National Securities Corporation, he attempted to sell those shares to one of the company’s existing investors. The AWC stated that in March of 2016, the individual paid $35,291.47 to obtain 118,624 shares owed by Unsworth. That same individual further paid $32,946.52 to acquire 110,742 shares that Legend Merchant Group, Inc. owned. With both of those transactions, Unsworth reportedly failed to notify National Securities Corporation about his activities. FINRA found Unsworth’s conduct violative of FINRA Rules 2010 and 3280.

This is not the first time that Unsworth has been sanctioned by FINRA for misconduct. Particularly, he was fined $25,000.00 and suspended by FINRA in all capacities for three months according to an Order Accepting Offer of Settlement containing findings that Unsworth, inter alia, attempted to conceal a customer’s complaint from FINRA during the time that he was the chairman and chief executive officer of his former brokerage firm, Legend Merchant Group, Inc. Department of Enforcement v. David Woods Unsworth, Jr., Disciplinary Proceeding No. 2012032370501 (May 28, 2015). FINRA found that Unsworth’s conduct was violative of FINRA Rules 2010 and NASD Conduct Rule 2110.

Subsequently, Unsworth failed to pay the fine assessed by FINRA. Particularly, on June 23, 2017, FINRA revoked Unsworth’s securities registration based upon allegations that he failed to pay $10,930.11 of the $25,000.00 fine imposed in Disciplinary Proceeding 2012032370501.

FINRA Public Disclosure reveals that Unsworth is referenced in four customer initiated investment related disputes pertaining to accusations of Unsworth’s violative conduct during the time that he was associated with Oppenheimer & Co., Inc. and Legend Merchant Group Inc. Specifically, a customer initiated investment related arbitration claim regarding Unsworth’s activities was settled for $99,995.00 in damages founded on allegations that Unsworth executed unauthorized and unsuitable trades in the customer’s account. NASD Arbitration No. 95-02574.

Subsequently, a customer initiated investment related arbitration claim involving Unsworth’s conduct was resolved for $90,000.00 in damages supported by accusations that Unsworth failed to supervise over-the-counter equities transactions placed in the customer’s account. FINRA Arbitration No. 09-06486 (Apr. 7, 2011). Then, a customer initiated investment related arbitration claim concerning Unsworth’s activities was settled to resolve allegations that Unsworth misled the customer by misrepresenting the customer’s investment in a private placement. FINRA Arbitration No. 10-03438 (Apr. 19, 2012).

Unsworth’s registration with National Securities Corporation has been terminated as of March 24, 2017.

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