Michael Walter Mandel of Upper Saddle River, New Jersey, a stockbroker formerly registered with LPL Financial LLC, has been fined $5,000.00 and suspended for seven months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity founded on findings that he engaged in private securities transactions while he was associated with Royal Alliance Associates Inc. and LPL Financial. Letter of Acceptance, Waiver, and Consent No. 2021070900301 (March 2, 2022).
According to the AWC, from May of 2014 to October of 2016, Mandel took part in $815,000.00 worth of private securities transactions without notifying his employer.
FINRA states that eighteen investors were solicited by Mandel for private securities transactions. Seven of those customers held accounts at Royal Alliance Associates or LPL Financial. The AWC states that the entire $815,000.00 investment went towards a tequila production company. Mandel had the customers meet with the founder of the company. Investors were invited by Mandel to the company’s promotional events and were provided with documents by Mandel for the investment opportunity. Mandel received compensation for this.
The AWC states that Mandel was prohibited by Royal Alliance Associates and LPL Financial from selling away activities. The securities broker dealers were not provided with any written notice from Mandel regarding the private securities transactions. Mandel never received any approval from the securities broker dealers to engage in those activities. FINRA also states that Mandel was administered a compliance questionnaire which he falsely responded to by claiming that he did not engage in any private securities transactions.
On November 15, 2021, the tequila company’s founder pled guilty to misusing investor funds and making false and misleading statements to investors. The founder was charged by Securities and Exchange Commission (SEC) in a Complaint on February 17, 2021. SEC’s Complaint alleges that the founder misappropriated funds from investors for his personal use. He was also charged with misrepresenting information to investors. A judgment was entered against the founder, and he was enjoined from committing future violations of federal securities laws.
FINRA states that Mandel violated FINRA Rules 2010 and 3280 and National Association of Securities Dealers (NASD) Rule 3040.
FINRA Public Disclosure additionally reveals that Mandel is identified in a customer initiated investment related written complaint where the customer requested $7,945.00 in damages based upon allegations of the customer being misled on municipal bond purchases during the time that Mandel was registered with Royal Alliance Associates.
Mandel was employed by Royal Alliance Associates between August 8, 2008, and December 11, 2015. He was registered with LPL Financial between December 8, 2015, and February 11, 2022. Mandel was discharged by LPL Financial supported by accusations of his solicitation of investors for private securities transactions.
