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California Securities Lawyer Update: Morgan Stanley Broker Suspended for Altering Client Information
By George C. Miller, Esq. of Shustak Reynolds & Partners, P.C. posted on Tuesday, August 8, 2017.
George C. Miller
Partner
Location: San Diego, California
Phone: (619) 696-9500 (Ext. 105)
Direct: (619) 501-8270
Email: [email protected]
George C. Miller, Esq.
619.696.9500 ex. 105
[email protected]
The Financial Industry Regulatory Authority (FINRA) recently suspended and fined Christopher Stoddard, a 20-year securities industry veteran, for modifying client contact information prior to his departure from Morgan Stanley. According to a FINRA Letter of Acceptance, Waiver and Consent, Stoddard altered four client phone numbers and email addresses in Morgan Stanley’s client management database, presumably so other Morgan Stanley advisors would be unable to contact those clients following his resignation.
FINRA Rule 4511 requires members to “make and preserve books and records” as required by the Securities Exchange Act of 1934 and other applicable rules. Rule 2010, meanwhile, requires all members to observe “high standards of commercial honor and just and equitable principles of trade” in conducting their business. By falsifying client telephone numbers, FINRA took the position Stoddard violated both Rules 2010 and 4511. In the Acceptance, Waiver and Consent agreement, Stoddard agreed to a 20-calendar day suspension from the securities industry and payment of a $5,000.00 fine. According to its 2017 Sanction Guideline, FINRA typically recommends a suspension of 10 days to 3 months and payment of a $1,000.00 to $15,000.00 fine for similar rule violations.
After leaving Morgan Stanley, Stoddard joined Wells Fargo but was terminated after the firm learned of his alleged conduct in connection with his departure from Morgan Stanley. Stoddard is now affiliated with Stifel, Nicolaus & Company.
Shustak Reynolds & Partners, P.C. focuses its practice on financial and securities matters and the securities industry affecting broker-dealers, registered representatives, investors and the financial services sector. For more information, contact Erwin J. Shustak, managing partner, at [email protected], or call 800.496.5900 for a free consultation.
