Christopher Francis Harrington Jr. of New York, New York, a stockbroker registered with Merrill Lynch Pierce Fenner Smith Inc., has been fined $11,500.00 and suspended for nine months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity because Harrington generated excessive fees and made unsuitable investment recommendations. Letter of Acceptance, Waiver, and Consent No. 2019061789201 (July 7, 2023).
According to the AWC, in 2014, a 48-year-old Customer A, who was rendered unable to work due to an accident, invested his $10,000,000.00 settlement with Harrington. The customer aimed to get returns from this investment while keeping transaction costs low. However, Harrington consistently advised Customer A in a manner that led to unnecessary and avoidable fees and commissions.
For instance, by the end of 2014, the stockbroker had advised buying $1,400,000.00 in market-linked investments which accrued fees. Soon after, these MLIs were shifted to another account, incurring another fee. From February 2015 to March 2015, Harrington’s advice led to the sale of $550,000.00 of MLIs, resulting in commissions of $7,550.00. In August of 2016, recommendations by Harrington generated commissions of $25,000.00 through subsequent ETF purchases. FINRA indicated that these actions lacked a genuine purpose other than boosting Harrington’s earnings.
Harrington’s advice also contradicted Merrill’s guidelines, as he made recommendations of short-term trading for products meant for long-term holds, like unit investment trusts and market-linked investments.
From March 2015 to May of 2017, Harrington advised the buying and swift selling of eight UITs worth around $1,000,000.00 and 33 MLIs amounting to almost $10,000,000.00, with 25 of those sold for about $6,600,000.00. Additionally, Harrington advised MLP purchases but sold them shortly afterward. From September of 2014 to March of 2015, nearly $1,850,000.00 of MLPs were bought and all sold by April of 2015 on Harrington’s recommendation.
Harrington violated FINRA Rules 2010 and 2111(a).
Public Disclosure shows that Harrington is also referenced in a customer initiated investment related complaint filed on August 2, 2011, in which the customer requested $25,000.00 in damages based upon allegations that Harrington coerced the customer into making a private placement investment during the period that Harrington was associated with John Thomas Financial. This complaint was closed without a resolution.
Harrington was associated with Merrill Lynch Pierce Fenner Smith Inc. as a stockbroker from May 11, 2011, to December 1, 2017, and associated with Laidlaw Company (UK) Ltd. as a stockbroker from December 14, 2017, to June 30, 2022.
