Securities Arbitration Investment Fraud Lawyers » Misappropriation of Funds » FINRA Sanctions Kingsbury Stockbroker For Selling Away

Sign of the Financial Industry Regulatory Authority

Stewart Irwin Schram of Northbrook Illinois a stockbroker formerly registered with Kingsbury Capital Inc. has been fined $7,500.00 and suspended for four months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity supported by findings that Schram engaged in outside business activities and private securities transactions during the time that he was associated with Kingsbury. Letter of Acceptance Waiver and Consent No. 2018059532901 (Feb. 19, 2021).

According to the AWC, between April of 2013 and February of 2015, Schram involved himself with multiple companies that purchased and sold real estate properties. The AWC stated that Schram managed the companies’ records and books and took part in other administrative functions.

Kingsbury Capital was not notified by Schram about his outside business activities prior to him engaging in them. Schram was also administered an annual compliance questionnaire which called upon him to identify these outside business activities. Schram failed to disclose this information in his response. Schram violated FINRA Rules 2010 and 3270 for this reason.

The AWC also stated that Schram was selling away from Kingsbury Capital. The regulator indicated that Schram established a company for buying, renovating and selling properties. 13 people had been solicited by Schram for purposes of investing $485,000.00 in the company. FINRA stated that 6 of those investors maintained accounts at Kingsbury. Schram failed to inform Kingsbury about those transactions and did not receive authorization to engage in them. FINRA found that Schram’s conduct was violative of FINRA Rule 2010 and NASD Rule 3040.

FINRA Public Disclosure also confirms that a customer filed an investment related FINRA securities arbitration claim regarding Schram’s activities where the customer sought $300,000.00 in damages founded on allegations that unsuitable investments in direct participation programs or limited partnerships had been effected by Schram during the time that he was associated with Edwin C. Blitz Investments Inc. FINRA Arbitration No. 16-00507 (Apr. 13, 2016).

Schram’s registration with Kingsbury Capital has been terminated as of July 12, 2018. He was registered with Cambridge Investment Research Inc. between July 12, 2018 and October 31, 2019.