James Edward Kelly Sr., of Owings Mills, Maryland, a stockbroker formerly registered with Pruco Securities LLC, has been fined $5,000.00 and suspended for two weeks from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity founded on findings that he engaged in unauthorized commission-sharing arrangements relating to his sales of variable annuities. Letter of Acceptance, Waiver, and Consent No. 2020065022802 (November 22, 2021).
According to the AWC, between 2014 and 2019, thirty-nine customers had been referred to Kelly through a representative of an affiliate of Pruco Securities. FINRA states that forty-five variable annuity purchases had been made by customers because of Kelly. The representative who made these referrals received half of the commissions that Kelly earned, amounting to $118,007.95. None of Kelly’s commission-sharing arrangements on these referrals were disclosed to Pruco Securities. The AWC states that Kelly caused the records and books of Pruco Securities to contain inaccurate information pertaining to his securities sales. Kelly violated FINRA Rules 2010 and 4511.
Kelly has been identified in two additional customer initiated investment related disputes concerning accusations of his misconduct while registered with Pruco Securities. FINRA Public Disclosure shows that a customer filed an investment related complaint concerning Kelly’s activities in which they sought compensatory damages supported by allegations of omissions of information relating to the purchase of an insurance contract.
On March 23, 2020, another customer filed an investment related complaint involving Kelly’s conduct. They sought compensatory damages based upon accusations that when Kelly was associated with Pruco Securities, he failed to disclose risks and guarantees on variable annuities.
Kelly was discharged by Pruco Securities on December 9, 2019, founded on allegations of his unauthorized activities relating to variable annuity sales.
