Jay J. Gruenebaum, of Zanesville, Ohio, a stockbroker formerly registered with Stifel, Nicolaus & Company, was permanently barred from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity after consenting to findings that he obstructed a FINRA investigation into allegations that Gruenebaum mishandled customer accounts. Letter of Acceptance, Waiver and Consent, No. 2016049236901 (Oct. 10, 2016).
According to the AWC, on June 16, 2016, Gruenebaum was terminated by Stifel, Nicolaus & Company based upon allegations that he made payments to the firm’s customers in an unauthorized manner. The firm later disclosed to FINRA that Gruenebaum was named in two customer complaints, in which customers alleged that Gruenebaum mishandled the customers’ accounts and made faulty representations to such customers.
The AWC stated that on September 12, 2016, Gruenebaum was sent a request from FINRA to provide recorded testimony, per FINRA Rule 8210, in connection with FINRA’s investigation into allegations of Gruenebaum’s misconduct identified by his former firm. The AWC stated that counsel for Gruenebaum reached out to FINRA personnel on September 16, 2016, indicating that Gruenebaum was in receipt of FINRA’s request, but that Gruenebaum would not be providing such testimony for FINRA at any point. FINRA found that Gruenebaum’s conduct was violative of FINRA Rules 2010 and 8210, leading to his permanent bar.
FINRA Public Disclosure reveals that Gruenebaum has been named in several customer initiated investment related arbitration claims, and at least two separations from employment based upon allegations of misconduct. Particularly, on March 26, 2013, Gruenebaum’s former employer, Merrill Lynch, Pierce, Fenner & Smith Incorporated, terminated Gruenebaum based upon allegations against Gruenebaum of altering customer documents in a number of circumstances and retrieving documents from customers that were pre-signed, which violated his firm’s policies and resulted in the firm’s loss of confidence in Gruenebaum.
On May 29, 2013, Gruenebaum settled a customer initiated investment related arbitration claim for $150,000.00 based upon the customer’s allegations that Gruenebaum made misrepresentations and investment recommendations that were unsuitable for the customer. On April 21, 2016, Gruenebaum was named in a customer initiated investment related arbitration claim, in which the customer requested $50,000.00 in damages based upon allegations that Gruenebaum made unsuitable investment recommendations. On May 4, 2016, Gruenebaum was again subject to a customer initiated investment related arbitration claim, in which the customer alleged that Gruenebaum did not properly apprise the customer concerning the risk associated with the customer’s investments.
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