James Joseph Kearney of Houston Texas a stockbroker formerly registered with Raymond James Associates Inc. has been fined $2,500.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that Kearney executed more than two-hundred unauthorized trades in the accounts of Raymond James customers. Letter of Acceptance Waiver and Consent No. 2018060118401 (Nov. 14, 2019).
According to the AWC, between November of 2017 and May of 2018, there were more than two hundred trades that had been effected by Kearney in the accounts of twenty Raymond James customers. The investment strategies had been discussed between Kearney and his customers, but the stockbroker did not speak with them on the days he placed trades to ensure that the customers had authorized the transactions. The AWC stated that there was no written authorization provided to Kearney regarding discretionary trading, and there was no point in which the firm allowed for the stockbroker to exercise discretion in the customers’ Raymond James accounts. FINRA stated that without any authorization from customers, and without Raymond James’ approval, trades were placed in violation of the securities broker dealer’s policy.
FINRA also stated that forty-seven trades had been mismarked by Kearney. Specifically, he made it seem as though trades had not been solicited by him when the trades were really executed on a discretionary basis. This led Raymond James to maintain inaccurate records in violation of Securities Exchange Act of 1934 and SEC Rule 17-a3.
FINRA determined that Kearney’s conduct was violative of FINRA Rules 2010 and 4511 as well as National Association of Securities Dealers (NASD) Rule 2510(b).
FINRA Public Disclosure reveals that Kearney is referenced in four customer initiated investment related disputes which pertain to allegations of his violative conduct during the period in which he was associated with Raymond James, Cowen Company and Morgan Keegan Company Inc. Specifically, a customer initiated investment related complaint concerning Kearney’s conduct was resolved for $12,000.00 in damages supported by accusations of Kearney engaging in unsuitable over-the-counter equity trading.
Another customer filed an investment related complaint regarding Kearney’s conduct where the customer requested more than $5,000.00 in damages based upon allegations that false or misleading statements had been made by Kearney concerning H. Quotient Inc. stock. while the stockbroker was associated with Morgan Keegan. Kearney is also referenced in a customer initiated investment related written complaint which was settled on January 17, 2019 for $225,000.00 in damages founded on accusations that stock trades had been effected in the customer’s account on an excessive, unauthorized and unsuitable basis when Kearney was employed by Raymond James.
Kearney was discharged by Raymond James on September 11, 2018 supported by allegations of his unauthorized stock and over-the-counter equities purchases in a Raymond James customer’s account.
