Richard Alan Kern, of Beavercreek, Ohio, a stockbroker formerly registered with Morgan Stanley, has been fined $7,500.00 and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that he effected trades in customer accounts without authorization. Letter of Acceptance, Waiver and Consent, No. 20160502058-01 (Mar. 15, 2017).
According to the AWC, from January of 2006 to April of 2016, discretion had been exercised by Kern in the account of a customer even though he lacked authorization. Apparently, twenty transactions had been effected in the customer’s account without the customer approving of them, and where Morgan Stanley did not authorize discretion to be utilized in the customer’s account.
The AWC additionally stated that from 2013 to 2016, Kern falsified information on the compliance questionnaires annually administered to him through Morgan Stanley regarding the exercise of discretion in the accounts of firm customers. Kern’s registration with Morgan Stanley ended on April 26, 2016, based upon allegations pertaining to transactions Kern effected in the account of a customer who was deceased. Ultimately, FINRA found that Kern’s conduct was violative of FINRA Rule 2010, as well as NASD Rules 2110 and 2510(b).
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