Close Close

Regulation and Compliance > Federal Regulation > FINRA

FINRA Bars Broker for Working Against Interests of His Firm, Clients

Your article was successfully shared with the contacts you provided.

The Financial Industry Regulatory Authority barred an ex-Thrivent broker who violated multiple FINRA rules by working against his own firm and clients’ interests and then provided the regulator with a false response to a request for information while it was investigating his actions, according to FINRA.

Without admitting or denying the findings, Paul William Petrillo on Jan. 9 signed a FINRA letter of acceptance, waiver and consent in which he agreed to be barred from associating with any FINRA member in any capacity. FINRA accepted the letter Friday.

Petrillo worked for Thrivent for 26 years, starting in 1992, according to his profile on FINRA’s BrokerCheck website. There’s only one disclosure listed there, about a dispute in which one of his customers alleged the rep “placed trades in her non-Thrivent account without consulting her.” The dispute was settled Oct. 30, 2017, for $33,000.

“Thrivent expects its financial professionals to operate under high standards and abide by all regulatory rules and requirements,” the company said in a statement provided to ThinkAdvisor Tuesday. “When we learned of the allegations against the individual, we performed an internal investigation,” it said, adding that, “as a result of the investigation… Thrivent terminated the individual’s relationship with the organization in April of 2018.”

From August 2013 through April 2, 2017, Petrillo placed 333 discretionary orders to buy or sell securities in 12 customer accounts away from Thrivent without notifying his firm or the executing firm of his relationship to Thrivent, according to the letter.

Petrillo also failed to notify Thrivent that he opened a family trust securities account over which he had trading authority in October 2013 without notifying his firm of the account’s existence.

By virtue of that “misconduct,” the rep violated FINRA NASD Rule 3050 and FINRA Rule 2010, according to FINRA.

Also, between April 3, 2017, and April 20, 2018, Petrillo participated in 14 undisclosed private securities transactions in two of the customer accounts, violating FINRA Rules 3280 and 2010, according to the letter.

Petrillo then provided a false response to a request for information by FINRA while it was investigating his actions, the regulator said. On Sept. 19, 2018, during the course of its investigation, FINRA asked Petrillo, to identify any customers’ accounts in which he traded away from his firm, “aside from one customer about whom FINRA already knew and in whose account Petrillo had previously admitted to trading,” according to FINRA.

The letter went on to claim: “Petrillo deliberately failed to inform FINRA about 11 customer accounts in which he effected trades away from his firm. Petrillo’s response was therefore false.” As a result of these actions, he violated FINRA Rules 8210 and 2010, FINRA alleged.

— Check out Royal Alliance Fined Over Reps’ Theft of $3.8M on ThinkAdvisor.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.