David James Williams of Rochester New York a stockbroker formerly registered with Allstate Financial Services has been fined $7,500.00 and suspended for 3.5 months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon findings that Williams engaged in outside business activities while he was associated with Allstate Financial Services. Letter of Acceptance Waiver and Consent No. 2020065559401 (Aug. 5, 2021).
According to the AWC, Williams formed Guardian Agency LLC and Elite Agency LLC which were both New York companies that he partially owned and managed. The AWC stated that full power and authority was granted to Williams as the manager of those limited liability companies. He was permitted by the companies to make all of the decisions on business activities.
Until the point of Williams’ discharge as stockbroker from Allstate Financial Services, he was doing insurance business that he did not tell Allstate about. Williams’ activities were not authorized by Allstate but this did not stop him. Williams made $70,000.00 in compensation by way of Guardian Agency and $390,000.00 in compensation from Elite Agency.
False representations were made to Allstate Financial Services by Williams as it pertained to his activities. Williams indicated in a compliance questionnaire that he did not receive any compensation through an undisclosed outside business activity while registered with the securities broker dealer. The only entity that had been disclosed by Williams was represented as a logical and consulting support services activity for agents. There was no mention of Guardian Agency or Elite Agency in Williams’ submission of compliance questionnaires. Williams violated FINRA Rules 2010 and 3270 for his undisclosed outside business activities.
Williams was registered with Allstate Financial Services between May 23, 2011 and February 10, 2020 at which point he was discharged based upon allegations of his ownership interests in other insurance agencies.