John E. Pelletier of Wauwatosa, Wisconsin, a stockbroker registered with BMO Harris Financial Advisors Inc., is the subject of an enforcement action initiated by Financial Industry Regulatory Authority (FINRA) in which the regulator is seeking sanctions against Pelletier based upon allegations that Pelletier engaged in unauthorized trading in the individual retirement account of a customer during the time that Pelletier was associated with BMO Harris Financial Advisors Inc. Department of Enforcement v. John E. Pelletier, Complaint No. 2021071094401 (September 21, 2023).
According to the Complaint, between May of 2017 and July of 2018, while Pelletier was associated with BMO Harris Financial Advisors Inc., he executed 17 transactions with a total principal value of $37,799.00 in the individual retirement account of a firm customer. His trading was conducted without obtaining the customer’s written consent.
Specifically, FINRA alleges that BMO Harris’s written supervisory procedures mandated stockbrokers to obtain proper authorization from the customer or an authorized agent for all securities transactions when the trade was placed. These procedures explicitly prohibited discretionary accounts and did not allow stockbrokers to accept trading instructions from third parties if there was no third party authorization or power of attorney on file.
In this particular instance, Pelletier purportedly assisted Customer A with the process of rolling over his qualified employer retirement plan account into an IRA at the firm. The account application identified Customer A as the sole owner of the account and the only one authorized to direct trading in that account. FINRA alleged that Pelletier executed 17 separate transactions in the account, based on verbal instructions received solely from someone who was not authorized on the account. Therefore, he allegedly violated FINRA Rule 2010.
FINRA Public Disclosure also shows that on February 10, 2021, a customer initiated investment related civil action involving Pelletier’s conduct was settled for $35,000.00 in damages based upon allegations that Pelletier had allowed unauthorized distributions to be made from the customer’s IRA at BMO Harris Financial Advisors Inc. Civil Action No. I20-6031-CZ.
Pelletier has been associated with LPL Financial LLC in Wauwatosa, Wisconsin since March 24, 2021. Previously, he was associated with BMO Harris Financial Advisors Inc. in Wauwatosa, Wisconsin from August 1, 2012, to March 24, 2021.
