Thomas H. Laws of Silver City New Mexico a stockbroker formerly employed by HD Vest Investment Services has been barred from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that Laws failed to provide FINRA with recorded testimony in its investigation into allegations of Laws’ involvement in private securities transactions or outside business activities while Laws was associated with HD Vest Investment Services. Letter of Acceptance Waiver and Consent No. 2019061095601 (Apr. 10, 2019).
According to the AWC, in 2019, an investigation had been commenced by FINRA into whether Laws engaged in conduct violative of FINRA Rules. FINRA was particularly reviewing whether Laws partook in private securities transactions or outside business activities during the time that he was employed with HD Vest Investment Services. Supposedly, on March 26, 2019, a request had been sent to Laws from FINRA under Rule 8210 which called upon Laws to provide the regulator with recorded testimony about his activities.
Evidently, on March 26, 2019, Laws reached out to FINRA personnel to confirm that he got FINRA’s correspondence. At that time; however, Laws reportedly communicated his refusal to cooperate with FINRA’s request for Laws’ testimony. FINRA found that Laws’ failure to cooperate was violative of Rules 2010 and 8210 as it precluded FINRA from determining whether Laws actually participated in the unapproved outside business activities or private securities transactions.
This is not the first time that Laws has been subject of an enforcement action by a securities regulator. Particularly, Laws was charged by Securities and Exchange Commission (SEC) in a Complaint alleging that Laws misappropriated funds from customers of an Albuquerque, New Mexico based public mining company, Santa Fe Gold Corporation, while Laws was the company’s Chief Executive Officer. Securities Exchange Commission v. Thomas H. Laws et al. Case No. 18-cv-01063-JB-SCY (D.N.M. Nov. 15, 2018).
According to the Complaint, between August of 2016 to February 2018, $1,100,000.00 in funds belonging to Santa Fe Gold investors had been directed to Laws and THL Financial Services Corporation – a Silver City, New Mexico based entity owned and operated by Laws. SEC alleged that the funds were transferred for third party services, mining equipment, the acquisition of a silver mine, and other corporate purposes. Funds were purportedly misappropriated by Laws in the process. The Complaint alleged that attempts to conceal the theft had been made by Laws through his fabrication of bank records, invoices and communications. SEC alleged that Laws was reportedly confronted by Santa Fe in September of 2018 regarding his activities; however, Laws refused to explain why he made the transfers.
SEC alleged that at the time of the Complaint being brought against Laws, investors were left without repayment of $725,000.00 in funds. Laws was alleged to have violated Securities Act of 1933 Section 17(a); Securities Exchange Act of 1934 Sections 10(b) and 13(b)(5); and SEC Rules 13b2-1, 13b2-2, 13a-14 and 10b-5.
Laws’ registration with HD Vest Investment Services has been terminated as of November 14, 2017.
