John Bernard Steffen, of Florence, Kentucky, an insurance broker formerly registered with Silver Oak Securities, Inc., has been named in a customer initiated written complaint on June 23, 2016, in which the customer requested $285,000.00 in damages based upon allegations that Steffen churned the customer’s account, breached his fiduciary duty, and effected unsuitable variable annuity transactions. Additionally, the customer alleged that Silver Oak Securities, USA Financial, Inc., and CFD Investments, Inc. failed to supervise Steffen’s activities.
FINRA Public Disclosure reveals that Steffen has been named in eleven customer disputes concerning allegations of his misconduct while employed with Pruco Securities, LLC, CFD Investments, Inc., Prudential Securities Incorporated, Silver Oak Securities, USA Financial Services, and Ohio National Equity Sales.
Particularly, on October 25, 1994, a customer complaint involving Steffen’s conduct was settled for $15,000.00 in damages based upon allegations that Steffen misrepresented the terms of a life insurance policy. On October 23, 1995, another customer complaint concerning Steffen’s conduct was resolved for $19,986.75 in damages based upon allegations that Steffen misrepresented the coverage provided within a variable appreciable life insurance policy.
Subsequently, on April 7, 1997, a customer initiated investment related complaint involving Steffen’s conduct was settled for $40,514.53 in damages based upon allegations that Steffen made faulty proposals concerning variable appreciable life insurance policies. On May 13, 2003, another customer complaint regarding Steffen’s actions was settled for $15,281.74 in damages based upon allegations that Steffen misrepresented the insurance coverage which the customer’s premium payments were capable of providing.
Further, on December 11, 2002, a customer complaint pertaining to Steffen’s conduct was settled for $7,485.00 in damages based upon allegations that Steffen misinformed the customer regarding an insurance policy’s premium outlay. On May 15, 2012, another customer initiated investment related written complaint regarding Steffen’s actions was resolved for $13,274.39 in damages based upon allegations that Steffen effected an unauthorized trade in the customer’s variable annuity account.
Additionally, on April 19, 2016, a customer filed a written complaint concerning Steffen’s involvement, in which the customer requested $1,200,000.00 in damages based upon allegations that Steffen committed elder abuse, misrepresentation, and churned the customer’s variable annuity account. On June 20, 2016, another customer initiated written complaint involving Steffen’s conduct was settled for $235,000.00 in damages based upon allegations that Steffen effected unsuitable variable and fixed annuity transactions, and churned the customer’s account.
FINRA Public Disclosure reveals that on March 14, 2014, Steffen was fined $5,000.00 and suspended for twenty days by Financial Industry Regulatory Authority (FINRA) based upon consenting to findings that he effected discretionary trades in customer accounts without authorization. Letter of Acceptance, Waiver and Consent, No. 2012035116901 (Mar 14, 2014).
According to the AWC, a total of 1,176 unauthorized transactions were effected by Steffen via his reallocations in variable annuity subaccounts that were held by 192 customers. The AWC additionally revealed that Silver Oak had not deemed the customers’ accounts to be approved for discretionary trading. Consequently, FINRA found that Steffen’s conduct was violative of FINRA Rule 2010 and NASD Rule 2510(b).
