Laurence M. Rothstein, of Cumming, Georgia, a stockbroker formerly registered with Edward Jones, has been fined $10,000.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that he effected unauthorized transactions in customer accounts and entered false customer account information into his firm’s records and books. Letter of Acceptance, Waiver and Consent, No. 2016051183801 (May 31, 2017).
According to the AWC, from November of 2015 to March of 2016, Rothstein effected sixteen transactions in a customer’s account involving the sale of securities even though the transactions were not authorized by the customer. Particularly, the customer never communicated when the orders were to be effected, or the amount, price and specific securities involved in the transactions. Evidently, stockbrokers such as Rothstein were prohibited by the firm from exercising discretion in the accounts of customers. FINRA found that Rothstein’s conduct was violative of FINRA Rule 2010 and NASD Rule 2510(b).
Moreover, in September of 2015, Rothstein made false entries of information in seventy-five of the firm’s customers’ accounts in reference to their goals and objectives for accumulating capital. Apparently, Rothstein never communicated with customers prior to stating what their goals were, and knew that customer information was not correct. Rothstein’s activities purportedly caused the firm to carry inaccurate information concerning customers’ investment objectives in violation of Securities Exchange Act Section 17(a). Consequently, FINRA found Rothstein’s conduct to be violative of FINRA Rule 2010 and 4511.
FINRA Public Disclosure reveals that on September 28, 2014, a customer filed an investment related written complaint involving Rothstein’s conduct, in which the customer requested $12,000.00 in damages based upon allegations that he failed to apprise the customer of the investment selections Rothstein made before purchases were effected in the customer’s account, and failed to notify the customer of commissions charged by him relating to the mutual fund purchases.
Rothstein was terminated from Edward Jones on August 2, 2016, based upon the allegations that he communicated with customers in violation of the firm’s policies. Since September 13, 2016, he has been registered with KMS Financial Services, Inc.
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