Kirk James Bertsch of Spearfish South Dakota a broker formerly registered with Farmers Financial Solutions LLC has been disgorged of illicit commissions and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that Bertsch sold away from his firm by engaging in a promissory note transaction. Letter of Acceptance Waiver and Consent No. 2018059666301 (Feb. 15, 2019).
According to the AWC, an investor had been solicited by Bertsch in October of 2017 in regard to a securities purchase which could not be effected through the firm. Apparently, the customer had been advised by Bertsch to buy Woodbridge Group of Company LLC promissory notes. The AWC revealed that a $50,000.00 promissory note purchase had been made by the customer at Bertsch’s direction. Consequently, Bertsch was compensated for his sales efforts. The AWC stated that a Chapter 11 bankruptcy petition had been filed by Woodbridge after the customer purchased the note.
The AWC stated that brokers including Bertsch were required to submit a written request to the firm for any private securities transactions the broker wanted to engaged in. Moreover, Bertsch was required to obtain authorization by the firm to engage in those types of transactions in advance of engaging in them. In Bertsch’s case, he reportedly failed to inform his firm about the Woodbridge promissory note transaction. Therefore, there was no authorization ever provided to Bertsch by the firm. Consequently, FINRA found Bertsch’s conduct violative of FINRA Rules 2010 and 3280.
This is not the first time Bertsch has been subject of a regulatory action for selling away. Specifically, Bertsch has been fined $5,000.00 by the State of South Dakota Division of Insurance Department of Labor and Regulation according to a Consent Order for Imposition of Monetary Penalty and Order to Cease and Desist supported by allegations that Bertsch engaged in outside business activities and private securities transactions. In the Matter of Kirk Bertsch (Nov. 14, 2018).
According to the Order, Bertsch participated in transactions away from his broker dealer employer in which he failed to place those transactions on the records and books of the firm. The Order additionally contained accusations of Bertsch’s outside business activities engagements taking place without him providing any notification to the firm. Consequently, the Department of Labor and Regulation found Bertsch’s conduct violative of ARSD 20:08:03:06(2) and ARSD 20:08:03:06(3). Bertsch was ordered to cease and desist offers and sales of securities in South Dakota.
On August 27, 2018, Bertsch was discharged by Farmers Financial Solutions LLC based upon allegations that Bertsch failed to make disclosures to the firm about his private securities transaction, failed to procure the firm’s approval to buy and sell unregistered promissory notes investments; participated in outside business activities without gaining approval from the firm; and neglected to inform the firm about being subject of a regulatory inquiry into his suspicious securities transactions.
