FINRA Takes Action Against Unscrupulous Broker

by Joseph Bendel

FINRA filed a preliminary injunction this past month against Westor Capital Group for the misappropriation and misuse of customer funds. FINRA charges that Westor has refused to allow customers to withdraw money from their accounts, as well as executed unauthorized trades within customer accounts, and has requested a cease-and-desist order from the court. Further, FINRA has issued a complaint against Westor for, among other things, failure to maintain control of investor accounts, as it is required to do under federal securities law.

While the complaint has been filed in court, it is unlikely that it will ever come to a trial. FINRA allows for the named parties in a complaint to respond to the complaint. In such case, the issue will be heard by a FINRA disciplinary panel and may result in fines, censure, or other non-judicially imposed sanctions. This case highlights FINRA’s market regulation at the investment firm management level to protect consumers. See the full story here.