Shawn Edward Good of Wilmington, North Carolina, a stockbroker formerly registered with Morgan Stanley, has been charged by Securities and Exchange Commission (SEC) with operating a Ponzi scheme causing $2,000,000.00 in losses to investors. SEC v. Shawn Good, Case No. 7:22-cv-00060 (April 18, 2022).
According to the Complaint, between December 2012 and February of 2022, Morgan Stanley clients had been solicited by Good to invest through him. The customers were told to transfer funds from their accounts or to rely on credit lines to generate funds for investments. The customers were led to believe that Good would invest in tax-free government bonds and real estate development projects.
The regulator states that Good took money from newer investors to pay prior investors. Good allegedly defrauded investors who placed a large amount of trust in him, including mothers of young children and retirees. The Complaint states that Good violated Securities Exchange Act of 1934 Section 10(b), SEC Rule 10b-5, Investment Advisers Act of 1940 Section 206(1) and 206(2), and Securities Act of 1933 Sections 17(a)(1), 17(a)(2) and 17(a)(3).
Good has been barred from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity supported by allegations that Good failed to testify in a FINRA investigation. Letter of Acceptance, Waiver, and Consent No. 2022074131601 (April 14, 2022).
According to the AWC, FINRA received a Form U5 from Morgan Stanley showing that Good was terminated as a stockbroker for allegedly failing to cooperate with Morgan Stanley’s review of a customer’s accusations against him. The AWC states that Good was sent a request from FINRA regarding testifying in the investigation. On March 30, 2022, Good’s lawyer relayed that Good would not make any appearance to testify about the allegations made by Morgan Stanley. Good’s refusal to cooperate in FINRA’s investigation showed that he violated FINRA Rules 2010 and 8210. Good was barred as a stockbroker for this reason.
Good has been identified in two customer initiated investment related disputes concerning accusations of his activities. FINRA Public Disclosure shows that a customer filed an investment related complaint concerning Good’s conduct in which the customer requested compensatory damages based upon allegations of the misrepresentation of an Ohio National annuity by Good while he was employed by Wells Fargo Advisors.
On April 13, 2022, another customer filed an investment related FINRA securities arbitration claim involving Good’s conduct where the customer sought $2,275,000.00 in damages founded on accusations that Good misappropriated the customer’s funds between August 2019 and February of 2022 during the time that Good was associated with Morgan Stanley. FINRA Arbitration No. 22-00783. The claim alleges that funds were taken from the customer’s liquidity access line accounts.
Good was registered with Morgan Stanley between December 6, 2012, and March 10, 2022.
