GunnAllen to pay $750,000 fine to settle charges

Regulators fined Tampa-based GunnAllen Financial Inc. $750,000 for multiple violations of securities industry rules. The Financial Industry Regulatory Authority (FINRA) said GunnAllen's lax supervision allowed its former head trader, Alexis Rivera, to defraud customers by putting profitable trades in his wife's personal account instead of the accounts of customers where they belonged. Rivera was fired in September 2005 and barred from the securities industry in December 2006. FINRA barred his supervisor, Kelley McMahon, from the industry for six months and levied a $25,000 fine.

And that wasn't all. FINRA said it found other serious violations in the investment banking department where it failed to put the stocks of its investment banking clients on a restricted list. That created the potential for misuse of insider information. Further, FINRA said GunnAllen failed to disclose a consulting contract with Richard J. Gladstone, who had been barred from the securities industry.

GunnAllen agreed to pay the fine to settle the matter and have the findings entered into the record. It did not admit or deny the allegations. Here's some of what company CEO Richard Frueh had to say:

"GunnAllen has resolved historical issues, reaffirmed its commitment to supervision and compliance and now looks forward to continuing to help our affiliates assist their clients achieve financial success."

Comments

Interesting, word is many EISA agents are out peddling again.