Ivan Shore of New York New York a stockbroker formerly registered with Oppenheimer Co. Inc. has been fined $5,000.00 and suspended for three months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity founded on findings that Shore made unsuitable recommendations to customers regarding unit investment trusts during the time that he was associated with Oppenheimer. Letter of Acceptance Waiver and Consent No. 2018057247001 (Nov. 6, 2020).
According to the AWC, Shore traded unit investment trusts in the accounts of Oppenheimer customers on a short term basis without regard for suitability. Shore advised on 900 occasions for customers to roll over existing unit investment trust holdings more than 100 days before those investments matured. The regulator indicated that those unit investment trusts generally had maturities of two years but were sold after customers only held them for 231 days on average. Proceeds of the premature unit investment trust sales had been used for purchases of additional unit investment trusts.
FINRA stated that in 240 occasions, customers were advised to sell a unit investment trust position only to purchase another unit investment trust in a newer series. These transactions were determined by the regulator to be series-to-series rollovers. Subsequent series of unit investment trusts maintained similar or the same strategies and objectives for investing as those products that customers previously held.
In one case, a customer had been advised by Shore to buy a unit investment trust that had a strategy of investing in a diversified common stock portfolio and objectives of generating above-average capital appreciation. The customer purchased that unit investment trust at Shore’s direction. 189 days later – which was prior to maturity – the customer was told to sell that unit investment trust and use the proceeds for the purchase of a newer series of the unit investment trust containing approximately the same strategy and objectives as what the customer already had. FINRA stated that Shore caused the customer to pay sales charges for a purchase of basically the same investment as the customer previously held.
FINRA determined that the advice provided by Shore was not suitable given the high cost and frequency of the unit investment trust transactions. Shore’s conduct was violative of FINRA Rules 2010 and 2111 as well as National Association of Securities Dealers (NASD) Rule 2310.
Shore has been employed by Oppenheimer since May 29, 1997.