Mircea Sauciuc of Leawood, Kansas, a stockbroker registered with Morgan Stanley Barney, has been fined $10,000.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that he effected unauthorized transactions in a customer’s account and made unsuitable investment recommendations. Letter of Acceptance, Waiver and Consent, No. 2017053126201 (Dec. 20, 2017).
According to the AWC, in October of 2016, customer RL informed Sauciuc that RL desired to liquidate RL’s ExxonMobil shares to buy equities in socially conscious and environmentally friendly companies. Between October of 2016 and November of 2016, a total of four-hundred and fifty-seven shares of RL’s’ ExxonMobil shares were reportedly liquidated by Sauciuc to invest in companies through Morgan Stanley; however, Sauciuc failed to procure authorization from RL prior to engaging in the transactions.
The AWC stated that forty transactions had been executed by Sauciuc, where thirty-nine of those transactions involved share purchases from twenty-three issuers and one transaction involved a stock sale. Those transactions collectively involved $37,194.00 worth of RL’s funds, enabling Sauciuc to accumulate commissions totaling $3,539.00.
The AWC stated that trades involving sixteen of the twenty-three issuers had been split between two trading days, which caused RL to pay $1,589.00 more in commissions than RL would have paid had Sauciuc effected one transaction per issuer instead of two.
FINRA found that Sauciuc’s transactions were executed on a discretionary basis; however, he lacked RL’s written permission to effect those trades beforehand. Consequently, FINRA found that Sauciuc’s unauthorized trading in RL’s account was violative of FINRA Rule 2010 and NASD Rule 2510(b).
FINRA also determined that Sauciuc effected transactions in RL’s account that were not suitable for RL based upon the costs and frequency of the transactions having been inconsistent with RL’s investment profile. Consequently, FINRA found that Sauciuc failed to have an adequate basis in concluding that the transactions he recommended were appropriate; conduct violative of FINRA Rules 2010 and 2111.
Sauciuc’s registration with Morgan Stanley was terminated on January 17, 2017.
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