John A. Crumb of Macedon New York a stockbroker formerly employed by LPL Financial LLC has been fined $12,500.00 and suspended for four months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that Crumb engaged in outside business activities that were not disclosed to LPL Financial LLC and (2) Crumb entered into an unapproved customer loan arrangement. Letter of Acceptance Waiver and Consent No. 2016050457501 (Oct. 5, 2017).
According to the AWC, between 2013 and 2016, Crumb had established a corporation for accounting and tax purposes which related to Crumb’s securities related business. Thereafter, in 2016, sales had been solicited by Crumb in regard to a private offering. Apparently; throughout this time, Crumb never informed LPL about setting up this company or being the corporation’s Chief Executive Officer.
Apparently, from 2014 to 2016, a number of compliance questionnaires had been submitted by Crumb in which he failed to be forthcoming about his outside business activities. Crumb reportedly lied about not being involved in any outside activities. FINRA found Crumb’s failure to make the required disclosures about his outside business activities to be violative of FINRA Rules 2010 and 3270.
The AWC stated that Crumb also entered into an unapproved customer loan arrangement in July of 2015. Evidently, this transaction involved Crumb borrowing funds belonging to a customer of the firm. The AWC revealed that Crumb did not notify LPL Financial LLC about the loan, so the firm never authorized Crumb’s activities. Moreover, when submitting the compliance questionnaire administered to him in 2016, Crumb reportedly omitted information about him borrowing from a customer. FINRA found that Crumb’s prohibited customer loan arrangement was violative of FINRA Rules 2010 and 3240.
LPL Financial LLC terminated Crumb on May 26, 2016 based upon accusations that he tried to get customers to purchase investments outside the firm’s auspices; conduct violative of LPL Financial LLC’s policies.
