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March 10, 2020 at 11:50 AM
The Financial Industry Regulatory Authority sanctioned a former Morgan Stanley representative for failing to inform the firm about the “full nature of his participation” in an outside business that engaged in gunsmith activities, according to FINRA.
Without admitting or denying the findings, Benjamin Kaz Fujihara, signed a FINRA letter of acceptance, waiver and consent Feb. 29 in which he agreed to a 30 business-day suspension from associating with any FINRA member firm and pay a $5,000 fine. FINRA accepted the letter Friday.
Morgan Stanley declined to comment Monday. Fujihara became registered through the firm as a general securities representative in June 2009, according to FINRA. In November 2016, he requested in writing that Morgan Stanley approve his participation in an outside business that engaged in gunsmith activities, including restoring and performing woodworking services on firearms, FINRA said.
In January 2017, Morgan Stanley approved Fujihara’s participation in the proposed outside business, provided he limit his role to gunsmith activities and not use his federal firearms license as a dealer of firearms. Morgan Stanley also advised Fujihara that he would have to get written approval before making any changes to his outside business activity or looking to take part in any additional outside business activities, according to the FINRA AWC letter.
However, between February 2017 and July 2018, Fujihara bought and resold a small number of firearms via his outside business without performing any woodworking or other gunsmith services on the firearms before selling them, FINRA said. In so doing, Fujihara engaged in outside business activities without providing full and accurate prior written notice to Morgan Stanley of those activities, according to the FINRA AWC letter.
As a result, Fujihara violated FINRA Rules 3270 (governing outside business activities of registered persons) and 2010 (governing standards of commercial honor and principles of trade).
