YOLO? Finra Raps Ex-Wells Broker who requested a pandemic loan to fund his online trading account

0

July 22, 2021

The Financial Sector Regulator fined and suspended a former Wells Fargo Advisors broker who allegedly sought to use a government pandemic relief loan for small businesses to fund his self-directed brokerage account.

Kenric Sexton, who had been a broker for six years with Wells in Charlotte, North Carolina, agreed to a $ 2,500 fine and a one-month suspension, according to a letter of acceptance from Finra finalized on Wednesday.

In June 2020, Sexton “negligently twisted” that he was operating his self-directed online trading account as a sole proprietorship and had received a $ 1,000 advance on an economic disaster loan, according to the settlement.

In July last year, the Small Business Administration turned down her loan application, but Sexton’s false claims violated the 2010 Finra rule prohibiting “unethical misconduct, whether involving or not a title “.

“Sexton, then a registered representative of Wells Fargo with no disclosed outside business activities, did not operate any business eligible for an SBA small business loan,” Finra said.

Sexton, who did not respond to a request via social media to comment on this story, neither admitted nor denied Finra’s findings, the AWC letter said. His Linked In page now identifies him as a business loan consultant in Charlotte for Dividend America, a division of DPG Investments.

Finra appeared to attribute Sexton’s negligence to negligence rather than malicious intent.

“Sexton did not carefully read the requirements of the economic disaster loan program before applying for a loan,” the letter from Finra said.

The SBA on its website defines the purpose of the funds distributed by EIDL: “To meet financial obligations and operating expenses that might have been met had the disaster not occurred.”

Finra began her investigation into the Sexton loan after Wells Fargo terminated it and filed a U5 form, stating that she released him after asking “for business support from the Small Business Administration when [he] had no pre-existing formal business as required, ”according to Finra’s letter.

A Wells Fargo spokesperson declined to comment for this story.

For an industry observer, Sexton should be given the benefit of the doubt.

Finra’s allegations against Sexton fall into the same category as a “no-fault-no-fault” basketball court event, writes Bill Singer, a securities attorney who blogs about brokerage legal battles, in a report. opinion piece published on July 22. .

“Notably, there is nothing in the AWC that asserts that Sexton knew he was engaging or intended to engage in any sort of fraud – on the contrary, it somehow appears to have been able to thinking (through negligence as his state of mind may have emerged) that he had a legitimate basis for applying for the loan, ”Singer adds.


Source link

Leave A Reply

Your email address will not be published.