Fan Kam Yip, of Mercer Island, Washington, a stockbroker formerly registered with Raymond James Financial Services, Inc., has been fined $5,000.00 and suspended for three months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that he sold away from his firm. Letter of Acceptance, Waiver and Consent, No. 2016051683901 (Aug. 25, 2017).
According to the AWC, Yip engaged in a private securities transaction on June 12, 2013, where he solicited customer TC to make an investment in a weight management company. Apparently, the investment made by the customer had been facilitated by Yip, where he performed the research on the investment and aided the customer in completing the requisite documentation.
Evidently, TC allocated $50,000 towards the investment in return for a two-year convertible promissory note. Yip’s efforts were rewarded by way of him getting a finder’s fee of $3,000.00. Yet, the customer sustained losses in connection with the investment, prompting the firm to provide TC with repayment.
The AWC stated that Yip’s involvement in the securities transaction was never made known by Yip to his firm as the firm’s policies set forth. Particularly, Yip was administered a compliance questionnaire for his activities in 2014 and 2015, where he reportedly acknowledged to having been cognizant of the firm’s policies on private securities transactions that forbade him from facilitating in them absent approval from the firm. Yet, the AWC revealed that Yip confirmed that he had not conducted any private securities transactions. Consequently, FINRA found Yip’s conduct to be violative of FINRA Rule 2010 as well as NASD Rule 3040.
FINRA Public Disclosure reveals that Yip was fired by Raymond James Financial Services, Inc., on September 14, 2016, due to allegations of his misconduct including selling away and causing a customer to sue the firm. On May 2, 2017, a customer initiated investment related civil action involving Yip’s conduct was settled for $25,000.00 in damages grounded on allegations of respondent superior, negligence, violation of the State of Washington’s Consumer Protection Act, unjust enrichment and breach of contract.
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