Keith Craig Baron, of Jericho, New York, a stockbroker previously registered with Equity Services Inc., has been barred by the Financial Industry Regulatory Authority (FINRA) from associating with any FINRA member firm in any capacity. The disciplinary action stems from Baron making false statements to both his employer and FINRA, engaging in private securities transactions, failing to disclose his outside business activities, and omitting material information and making misrepresentations to investors. Department of Enforcement v. Keith C. Baron, Extended Hearing Panel Decision, Disciplinary Proceeding No. 2022073772701 (January 15, 2025).
According to the Decision, Baron engaged in a series of sales practice violations between 2016 and 2022 while working as an Equity Services Inc. stockbroker. The case centered around his involvement with Native American Energy Group Inc., a financially distressed company operating in the oil and gas sector.
In early 2016, Baron introduced two investors, referred to as Investor A and Investor B, to the CEO of Native American under the pretense that the company’s stock was a lucrative investment opportunity. Baron made misleading statements, including assurances that the investors would make money very fast, that Native American stock was guaranteed to be publicly traded, and that its value would increase before the end of 2016.
Baron failed to disclose to the investors that he had a consulting agreement with Native American, under which he was entitled to receive $10,000.00 per month in fees. Following Baron’s representations, the investors made four separate purchases of Native American stock, totaling $359,806.00. When one of the investors later expressed concerns about the safety of their investment, Baron continued to make additional misrepresentations, including false assurances that their money was not lost and that their returns would be high.
FINRA also found that Baron also failed to disclose his outside business activity with Native American to his employer, Equity Services Inc., as required by FINRA Rule 3270. Instead, he falsely certified in annual compliance documents that he had no undisclosed business activities.
Also, Baron participated in the private securities transactions involving the two investors’ purchases of Native American stock without providing prior written notice to Equity Services, violating FINRA Rule 3280. The transactions, which occurred over a six-month period, resulted in Baron personally receiving approximately 50 percent of the investors’ purchase amounts in compensation. Baron also played a role in facilitating the transactions by helping the investors open self-directed IRA accounts, providing subscription agreements, and delivering stock certificates.
Baron was also found to have provided false and misleading information to both his employer and FINRA. When Equity Services reviewed a complaint filed by the investors, Baron submitted compliance records that falsely stated he had not engaged in outside business activities or private securities transactions. Additionally, in written responses to FINRA’s inquiries, Baron made misrepresentations of his role in the transactions, denied that he received any compensation, and downplayed his business relationship with Native American.
FINRA Public Disclosure shows that Baron was referenced in six customer initiated investment related disputes concerning Baron’s conduct while associated with securities broker dealers. On September 21, 2012, a customer initiated investment related FINRA securities arbitration claim involving Baron’s conduct was settled for $2,500.00 in damages based upon allegations that Baron made misrepresentations of material fact in connection with the sale of variable annuities when Baron was associated with NYLIFE Securities LLC. FINRA Arbitration No. BASC 394-12.
On June 24, 2014, a customer initiated investment related complaint involving Baron’s conduct was settled for $68,124.24 in damages based upon allegations that Baron used misleading or inaccurate marketing materials in connection with the sale of mutual funds and universal and traditional whole life insurance when Baron was associated with NYLIFE Securities LLC.
On July 22, 2019, another customer filed an investment related complaint involving Baron’s conduct in which the customer requested $425,000.00 in damages based upon allegations that Baron committed fraud in connection with the sale of over-the-counter equities when Baron was associated with Equity Services Inc. This complaint was denied.
Baron was also referenced in a FINRA securities arbitration claim that was settled for $175,000.00 in damages based upon allegations that Baron misappropriated funds when Baron was associated with Equity Services Inc. FINRA Arbitration No. 22-02591 (July 27, 2023).
Baron was associated with Equity Services Inc. in Jericho, New York, from August 13, 2015, to January 7, 2022.
