Securities Arbitration Lawyer Blog
The Financial Industry Regulatory Authority (“FINRA”) has barred compliance officer Corey White from the securities industry and fined him $20,000. Mr. White was expelled from the brokerage industry for supervisory failures during his tenure as a compliance officer for Financial West Group in Westlake Village, CA, from January 2013 to July 2017. Among other things, Mr. White was accused of failing to respond to red flags that indicated brokers were excessively trading customer’s accounts. FINRA previously barred Financial West Group from the securities industry in February 2020.
Mr. White left Financial West Group in August 2017 to become a compliance officer at Western International Securities, Inc. in Pasadena, CA.
Financial West Group and Western International Securities Inc. seem to be cut from the same cloth. Earlier this month, FINRA filed a disciplinary proceeding complaint against former Western International Securities broker Megurditch Patatian (aka Mike Patatian), alleging that he unsuitably recommended illiquid REITs to 59 customers. Mr. Patatian worked out of the firms’ branch office in Westlake Village, CA. You can read more about the charges here:
If you have suffered financial losses investing with Western International Securities Inc., or suspect inappropriate activity in your investment or retirement account, contact New York securities arbitration law firm Iorio Altamirano LLP for a free and confidential review of your account or annuity contract.
Iorio Altamirano LLP represents investors that have disputes with their financial advisors or brokerage firms, such as Western International Securities.
FINRA Letter of Acceptance, Waiver, and Consent No. 2017054755209
Corey A. White and FINRA entered into a Letter of Acceptance, Waiver, and Consent (“AWC”) on March 19, 2021. The AWC included the following factual allegations:
- Between January 2013 and July 2017, Mr. White was responsible for establishing, maintaining, and enforcing the firm’s supervisory systems and Written Supervisory Procedures (“WSPs”) at Financial West.
- Additional, Mr. White was responsible for monitoring the activities of all registered brokers through the review of daily trade blotters and exception reports.
- White failed to reasonably discharge these responsibilities.
- White also failed to respond reasonably to red flags indicating brokers were excessively trading and recommending qualitatively unsuitable transactions, including transactions involving Non-Traditional Exchange Traded Products (“ETPs”), low-priced securities, and options.
- For example, Mr. White did not review the MAS exception reports because “there were too many to review.”
- Between January 2013 and December 2016, Mr. White encountered additional red flags indicating trading misconduct by five representatives involving ten accounts belonging to six customers.
- The accounts repeatedly appeared on the MAS exception reports and reflected high annualized turnover rates, a high volume of transactions, high commission amounts, and large losses.
- The accounts experienced in-and-out trading-i.e., a pattern of buying and selling the same security multiple times over a short period of time, and indicative of excessive trading.
- The customers had investment objectives that were inconsistent with the short-term trading activity occurring in the accounts, including trading in low-priced securities.
- The customers sustained losses due to the representatives’ excessive trading.
- White failed reasonably to respond to these red flags.
- As a result, Mr. White violated NASD Rules 3010(a) and (B), and FINRA Rules 3110(a) and (b), 2360(b)(210) and 2010.
Western International Securities – Supervisory Duties
Brokerage firms like Western International Securities must properly supervise financial advisors and customer accounts. Proper supervision of senior investors’ accounts is especially critical. Brokerage firms must also establish and maintain a reasonably designed system to oversee account activity, such as excessive trading, to ensure compliance with securities laws and industry regulations. When a brokerage firm fails to sufficiently supervise its financial advisors or the investment account activity, it may be liable for investment losses sustained by customers.
How to Recover Financial Losses or Free Obtain a Free Consultation
If you have lost money with Western International Securities Inc., contact New York securities arbitration attorney August Iorio of Iorio Altamirano LLP. August Iorio can be reached at august@ia-law.com or toll-free at (855) 430-4010 for a free and confidential evaluation of your account.
Iorio Altamirano LLP is a securities arbitration law firm based in New York, NY. Iorio Altamirano LLP pursues FINRA arbitration claims nationwide on behalf of investors to recover financial losses arising out of wrongful conduct by stockbrokers and brokerage firms.