Seth David Lampman, of Osceola, Iowa, a stockbroker for Edward Jones, was fined $5,000.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member firm in any capacity after consenting to findings that he engaged in unauthorized trading in customer accounts. Letter of Acceptance, Waiver and Consent, No. 2014042505601 (July 13, 2016).
According to the AWC, from May 23, 2014 through June 25, 2014, Lampman engaged in the authorized discretionary trading in the accounts of firm customers, EB, RB, AC, DF, LF, RP, and TP. The AWC stated that prior to Lampan’s effecting of such transactions, he merely interacted with customers verbally in 2014 about potentially exchanging certain funds in one fund family in order to purchase other funds in a different fund family.
In one example noted in the AWC, which occurred on June 20, 2014 regarding clients RB and EB, Lampman sold the customers’ Class A shares in Franklin Income Fund, Franklin US Government Securities, and Templeton Global Bond Fund. Lampman then purchased Class A shares on RB and EB’s behalf in American Balanced Fund, Capital Income Builder Fund, Income Fund of America Fund, and John Hancock Lifestyle Moderate Fund.
On June 27, 2014, Lampman reportedly sold AC’s Class A shares in Franklin Income Fund, and purchased Class A shares in Blackrock Global Allocation Fund. On June 27, 2014, Lampman sold DC and LF’s Class A shares of Templeton Global Bond Fund and purchased Class A shares of Investment Company of America Fund. On May 27, 2014, Lampman apparently sold RP and TP’s Class A shares of Franklin Income Fund, and purchased Class A shares of Capital Income Builder Fund, and Income Fund of America.
Lampman apparently failed to gain approval from all of his aforementioned customers before executing the transactions on a discretionary basis. Apparently, Edward Jones did not authorize and designate the accounts of such firm customers as discretionary. As such, FINRA found that Lampman’s unauthorized discretionary trading was violative of FINRA Rules 2510(b) and 2010.
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