Michael Lester Carter of Henderson Nevada a stockbroker formerly employed by Foresters Equity Services Inc. has been fined $5,000.00 and suspended from associating with any Financial industry Regulatory Authority (FINRA) member in any capacity based upon accusations that Carter sold away from the securities broker dealer by selling promissory notes to an investor. Letter of Acceptance Waiver and Consent No. 2018059752401 (May 28, 2019).
According to the AWC, in October of 2016, an investor had been steered by Carter to purchase Woodbridge Group of Companies LLC promissory notes. Evidently, Woodbridge Group of Companies LLC – a real estate fund – issued a promissory note to the investor through Carter’s involvement, and Carter was compensated as a result. Evidently, a bankruptcy petition was filed by Woodbridge in December of 2017. Subsequently, a final judgement had been obtained by SEC against Woodbridge Group of Companies and its owner, Robert H. Shapiro, mandating that Shapiro be fined and hand over unlawful gains from the Woodbridge promissory notes sales.
Apparently, during this time the promissory note purchase was facilitated by Carter, he was disallowed under Foresters Equity Services’ supervisory policies from pursuing private securities transactions without first asking the firm’s permission and gaining the firm’s permission. Nevertheless, no notice had been provided to the firm by Carter in reference to the outside promissory notes sales. Those private securities transactions were effected by Carter without the firm’s approval and outside the firm’s auspices.
Additionally, Carter was required to complete an annual questionnaire administered to him by Foresters Equity Services. In the submission of this questionnaire, Carter reportedly conveyed that he did not sell away from the firm – that there were no securities transactions Carter executed privately without the firm’s approval. Evidently, Carter also falsely reported that he did not effect any sales of promissory notes during this period. FINRA found Carter’s conduct violative of FINRA Rules 2010 and 8210.
FINRA Public Disclosure reveals that Carter is referenced in a customer initiated investment related arbitration claim in which the customer requested $25,000.00 in damages founded on allegations that while Carter was associated with Foresters Equity Services Inc., Carter sold the customer a real estate security away from the firm and this transaction was not suitable for the customer. FINRA Arbitration No. 18-01103 (May 29, 2018).
Carter’s registration with Foresters Equity Services has been terminated as of July 7, 2017.
