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March 10, 2020 at 01:59 PM
The Financial Industry Regulatory Authority sanctioned a former Summit Brokerage Services representative after he altered customers’ documents, according to FINRA.
Without admitting or denying the findings, John Stuart Crain signed a FINRA letter of acceptance, waiver and consent Feb. 25 in which he agreed to a three-month suspension from associating with any FINRA member firm and a $5,000 fine. FINRA accepted the letter Friday.
Crain is currently associated with FINRA member Chapin Davis Investments, according to his profile on FINRA’s BrokerCheck website.
Cetera Financial broker-dealer Summit, Chapin Davis and Gregory T. Lawrence, a partner at Lawrence Law in Baltimore, Maryland, who represented Crain in the dispute with FINRA, did not immediately respond to requests for comment Tuesday.
Crain entered the securities industry in 1996, when he became registered with FINRA as a general securities representative via his association with Morgan Stanley. In December 2002, he became registered as a GSR and general securities principal via his association with Summit, where he remained for 15 years.
In October 2012, Summit warned Crain that altering customers’ forms was prohibited by the firm, after discovering a blank customer-signed document in his files, according to the FINRA AWC letter.
However, from March 2017 through February 2018, Crain asked seven of his Summit customers to sign a total of nine blank or incomplete documents and then return them to him for completion, FINRA said. Crain then altered those forms by filling in the missing information and submitted them as originals to Summit, FINRA said.
The customers understood that Crain would add the missing information and all the information that Crain added to the documents was accurate, according to the FINRA AWC letter. Crain submitted the documents as originals to Summit “to effect transactions, all of which were requested by the customers,” FINRA said. Regardless, his actions still violated FINRA and Summit rules.
