Kenneth E. Crosser of Ottumwa, Iowa, a former registered representative with Girard Securities, Inc., was permanently barred from association with any FINRA-registered firm in all capacities after failing to appear for on-the-record testimony in connection with FINRA’s investigation into allegations that Crosser engaged in sales of structured settlement cash flow instruments to multiple investors without notifying his firm and receiving their approval. FINRA Letter of Acceptance, Waiver, and Consent, No. 2013037328701 (Aug. 19, 2015).
According to the Acceptance, Waiver and Consent
FINRA, pursuant to Rule 8210, sent Crosser a letter on July 1, 2015, requesting Kenneth E. Crosser provided on-the-record testimony regarding FINRA’s investigation into Crosser’s outside business activity. The AWC states that while Crosser’s counsel sent FINRA an e-mail on the same day acknowledging that Crosser received FINRA’s request, Crosser would not be willing to provide testimony at any point. Consequently, according to the AWC, Crosser’s failure to satisfy FINRA’s requests resulted in violations of FINRA Rule 2010 and 8210. Crosser was barred by FINRA as a result.
Selling away, also known as private securities transactions or undisclosed outside business activities, occurs when a stockbroker engages or participates in the sale of securities to investors outside of the formal approval of the securities firm with whom they are associated.
As a general matter, stockbrokers are only permitted to engage in the solicitation or sale of investments and investment related products approved by their firm. However, quite frequently, stockbrokers solicit, participate, or directly engage in the sale of typically unregistered securities or investments without the approval and outside of the auspices of their firm. These investments may take on many forms, and may include the recommendation of an outside money manager, or a hedge fund, which may sometimes turn out to be a Ponzi scheme. Sometimes these outside investments may include off-shore securities, insurance trusts, stocks or ownership interests in small businesses, startup ventures, corporate debentures, mortgage notes, private placements, promissory notes, oil & gas interests, real estate partnerships, pre-IPO shares, and a variety of other investments.
FINRA registered representatives like Kenneth E. Crosser who do not cooperate with FINRA’s investigations often face a permanent bar from practicing in the securities industry as such lack of cooperation violates FINRA’s Rule 8210 – requiring that no member or person shall fail to provide information or testimony or permit an inspection and copying of books, records, or accounts pursuant to the rule. FINRA typically accompanies a Rule 8210 violation with a Rule 2010 violation when individuals, according to FINRA, do not appear to observe high standards for commercial honor and just and equitable principles of trade.
Public Disclosure Records on Kenneth E. Crosser
According to FINRA’s BrokerCheck, Crosser has been subject to 2 customer disputes. On March 8, 2013, Crosser was alleged to have misrepresented a life insurance policy. In another case currently pending from July 29, 2014, a customer is requesting damages of $185,000 after alleging Crosser engaged in the sale of an unsuitable pension stream.
Additionally, Kenneth E. Crosser has been subject to a prior regulatory issue on February 12, 2014. In such issue, the state of IOWA had alleged that Crosser promoted and sold unregistered securities and engaged in a fraudulent, coercive, or dishonest practice in the business of selling insurance premium financed life insurance products. Consequently, Crosser was prohibited from selling Universal Life Products or annuities of any kind (among being subject to other limitations regarding the sale of insurance). Additionally, according to public records, Crosser agreed that he would permanently surrender his Iowa securities agent license and investment adviser representative license.
Guiliano Law Group
If you have been the victim of securities fraud and you have a complaint, you should consult with an attorney. The practice of Nicholas J. Guiliano, Esq., and The Guiliano Law Group, P.C., is limited to the representation of investors in claims for fraud in connection with the sale of securities, the sale or recommendation of excessively risky or unsuitable securities, breach of fiduciary duty, and the failure to supervise. We accept representation on a contingent fee basis, meaning there is no cost unless we make a recovery for you, and there is never any charge for a consultation or an evaluation of your claim. For more information contact us at (877) SEC-ATTY.
