Integrity Brokerage Services a securities broker dealer headquartered in Indianapolis Indiana, its Chief Executive Officer Joshua Helme, stockbroker Andrea Wood and stockbroker Marc Nathan Jaffe have been charged by Financial Industry Regulatory Authority (FINRA) in a Complaint alleging that Marc Jaffe engaged in securities business at Integrity Brokerage Services while he was disqualified and that Helme and Wood permitted Jaffe’s actions. Department of Enforcement v. Integrity Brokerage Services Inc. et al. Disciplinary Proceeding No. 2018056436001 (Apr. 22, 2020).
According to the Complaint, between February of 2016 and April of 2020, statutorily disqualified stockbroker Marc Jaffe continued to associate with Integrity Brokerage Services by getting involved in securities business affecting its customers.
FINRA indicated that Jaffe had still been statutorily disqualified in December of 2015 which was around the time that he had finished a suspension for failing to make required regulatory disclosures. An application to maintain Jaffe’s association with Integrity had been denied, with FINRA citing Jaffe’s serious misconduct. FINRA’s National Adjudicatory Council declined Jaffe’s application and made clear that Jaffe was not allowed to be an analyst for a securities broker at Integrity Brokerage Services.
FINRA contented that Helme viewed a National Adjudicatory Council’s decision as meaningless to him and enabled Jaffe to do what he wanted even after the decision was made by National Adjudicatory Council. FINRA stated that since May 2017, Jaffe has been actively permitted by Wood and Helme to take part in activities that call for FINRA registration. Jaffe has allegedly engaged in securities activities relating to customers’ accounts when under this disqualification.
The Complaint also alleges that customers were contacted by Jaffe in regard to their investments. Jaffe’s analyst agreement was purportedly just a cover for commissions that he received for securities business. The regulator indicated that Wood and Jaffe partnered with each other in handling transactions for Integrity Brokerage Services customers. This purportedly involved 40 percent of Wood’s investment advisory fees and brokerage commissions being paid to Jaffe.
FINRA Department of Enforcement alleged that Marc Jaffe’s conduct was violative of FINRA By-Laws and Rules 2010 and 1210 as well as National Association of Securities Dealers (NASD) Rule 1031. Helme and Integrity Brokerage Services have been accused of violating FINRA By-Laws and Rules 2010, 8311, 2020 and 2010 as well as NASD Rule 1031.
FINRA Public Disclosure reveals that Jaffe has been identified in 34 customer initiated investment related disputes containing allegations of his misconduct while employed by securities broker dealers including Morgan Stanley and Merrill Lynch. He is the subject of a customer initiated investment related written complaint which settled for $700,000.00 based upon allegations of churning and unsuitable over-the-counter equities trades in the customer’s Merrill Lynch account.
Another customer initiated investment related arbitration claim in reference to Jaffe’s conduct was resolved for $255,000.00 in damages based upon accusations that investment recommendations made to the Morgan Stanley customer were unsuitable and had caused the customer to incur unwarranted losses on over-the-counter equities. Jaffe has also been identified in a customer initiated investment related arbitration claim which was resolved for $55,000.00 in damages founded on accusations that misrepresentations were made to the customer by Jaffe in regard to mutual funds and over-the-counter equities transactions which were executed in the customer’s account. The claim alleges that trades were executed in excessive amounts and that investments were unsuitable in view of the customer’s objectives for investing.
Jaffe was also associated with Finance 500 Inc. but discharged on September 14, 2015 supported by allegations that he had violated FINRA Rules.