Arthur Robert Meunier (also known as Arthur Robert Breitman) a stockbroker formerly registered with Morgan Stanley has been fined $20,000.00 and suspended for two years from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that he engaged in undisclosed outside business activities while registered with the firm. Letter of Acceptance Waiver and Consent No. 2017056612801 (Apr. 18, 2018).
According to the AWC, between February of 2014 and April of 2016, Meunier took part in an outside business activity pertaining to a blockchain technology, Tezos. Evidently, Meunier conducted several business transactions involving Tezos which included his hiring of advisors and a chief operations officer; solicitation of prospective investors to procure up to $10,000,000.00 in working capital to finance the operations of the firm; and launch of the Tezos website.
The AWC stated that a business plan had been submitted to twelve prospective institutional and individual investors, which included four Morgan Stanley customers. Apparently, Meunier was described in the business plan as the chief executive officer of Tezos, where he proposed to be paid $200,000.00 each year.
The AWC stated that Meunier knew about his obligation to report outside business activities to Morgan Stanley; however, he failed to be forthcoming. Meunier reportedly concealed his activities by utilizing a pseudonym, L.M. Goodman in Tazos’ position papers and website. FINRA concluded that Meunier’s failure to notify Morgan Stanley about his outside business activities was violative of FINRA Rules 2010 and 3270.
In addition, FINRA stated that Meunier misrepresented his activities on Morgan Stanley’s compliance questionnaires. The AWC stated that Meunier completed the firm’s compliance questionnaires in June of 2014 and May of 2015, in which he stated that all outside business activities had been disclosed by him. FINRA found Meunier’s false statements in that regard to be violative of FINRA Rule 2010.
Moreover, Meunier was cited for disseminating a business plan for Tezos that was not fair or balanced. Particularly, Meunier reportedly failed to detail the basis by which Tezos may not achieve the future value or revenue that was projected, and he omitted information concerning the risks of the investment. Further, the AWC stated that the business plan contained misleading statements. Apparently, Meunier claimed that Tezos’ financial projections were based on the performance of Ripple and Ethereum which were established entities. Yet, at that time, Tezos generated no revenues, was in a development stage, and its financial projections relied upon the accumulation of working capital from investors. FINRA found Meunier’s conduct in that regard to be violative of FINRA Rules 2010 and 2210(d)(1)(A), 2210(d)(1)(B) and 2210(d)(1)(F).
Meunier’s employment with Morgan Stanley was terminated on April 21, 2016.
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