A FINRA hearing panel barred a registered representative, Jim Seol, for participating in private securities transactions, engaging in undisclosed outside business activities, and for making misrepresentations to his employer in compliance questionnaires.
The hearing panel found that Seol sold $100 million in EB-5 investments promoted through his private business, Western Regional Center Inc. (WRCI), yet failed to disclose this activity to his employing firm. Seol worked as an Ameriprise financial advisor in an Irvine, California branch office.
FINRA rules and Ameriprise’s policy required Seol to disclose and obtain prior approval for all outside business activities. Shortly after Seol’s belated revelation of his WRCI activities, Ameriprise terminated him on May 28, 2014, for violating the firm’s policy regarding disclosure of outside business activities.
According to the hearing panel decision, Seol formed WRCI in September 2011 to market U.S. investments to overseas investors through the U.S. government’s EB-5 program. The EB-5 program permits foreign investors to obtain a U.S. visa in exchange for investing in projects that create U.S. jobs.
Seol identified a potential investment opportunity for his newly formed company involving a solar energy power plant in Riverside, California. After negotiating an agreement with the power plant, Seol traveled to South Korea and China to market the investments to foreign migration companies and attorneys.
By the end of 2013, the offering was fully subscribed with all partnership units sold to 200 different investors contributing $500,000 each, totaling $100 million.