Lynn Cooper Faust (also known as Donna Lynn Cooper), of Greenville, South Carolina, a stockbroker formerly registered with Raymond James Associates, has been fined $5,000.00 and suspended for three months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity supported by findings that she made unsuitable recommendations to Raymond James Associates investors regarding unit investment trust (UIT) trades. Letter of Acceptance, Waiver, and Consent No. 2018060460401 (February 4, 2022).
According to the AWC, from January 4, 2013, to December 22, 2017, customers were advised by Faust to sell their UITs before their maturity and to roll over the proceeds into new UITs. Faust made 4,500 of those recommendations, affecting 300 customer accounts.
FINRA states that most of the UITs recommended by Faust contained maturities of at least two years. They carried up to 3.95 percent in sales charges. On average, Faust had customers sell their UITs in under a year and roll over their positions into new UITs.
Of the 4,500 occasions where Faust recommended a rollover, 2,200 occasions involved a series-to-series rollover. This meant that an investor was advised to sell their UIT and to purchase a UIT in a newer series. The UIT sold (the prior series), and the UIT purchased (the new series) carried similar, if not the same, strategies and objectives.
FINRA states that Faust made unsuitable recommendations given the cost and frequency of the transactions. Faust caused customers to pay unnecessary sales charges. She violated FINRA Rules 2010 and 2111.
FINRA Public Disclosure shows that Faust has been identified in four customer initiated investment related disputes containing allegations of her misconduct while she was employed by securities broker dealers including Raymond James. Faust is referenced in a customer initiated investment related NASD arbitration claim in which the customer was awarded $8,000.00 in compensatory damages based upon PaineWebber being found liable on the customer’s claims of unsuitability and misrepresentation.
On November 16, 2018, a customer filed an investment related complaint involving Faust’s conduct where the customer sought $59,000.00 in damages founded on accusations of misrepresentation by Faust at Raymond James Associates regarding market-linked notes. On September 26, 2019, a different customer initiated investment related complaint regarding Faust’s activities was settled for $81,895.09 in damages supported by allegations of Faust having misrepresented information about a unit investment trust held in the customer’s Raymond James account.
Faust was registered as a stockbroker and investment adviser representative of Raymond James Associates until October 17, 2018. Raymond James discharged Faust based upon accusations of her recommendations of UITs. Since November 9, 2018, Faust has been employed by Stifel Nicolaus Company as a stockbroker and investment adviser representative.