The Financial Industry Regulatory Authority suspended an ex-Merrill Lynch general securities representative for two years after he was caught possessing and accessing personal notes and other “unauthorized materials” while taking two separate industry exams within a month of each other, according to the regulator.
Without admitting or denying the findings, Andre Derricotte submitted a letter of acceptance, waiver and consent to FINRA Feb. 17 in which he agreed to be suspended from associating in any and all capacities with any FINRA member firm for 24 months and to pay a $5,000 fine over the incidents. FINRA accepted the letter Monday.
Merrill Lynch and Jeff Kern, a partner at law firm Sheppard Mullin’s New York office who represented Derricotte in the dispute with FINRA, did not immediately respond to requests for comment Tuesday.
Derricotte’s suspension was scheduled to start March 16 and end March 15, 2022, according to his profile at FINRA’s BrokerCheck website, which also shows he is not currently registered as a broker.
Merrill Lynch discharged Derricotte Jan. 23, saying it lost confidence in him due to his failure to be forthcoming with the firm and FINRA staff regarding his conduct at a FINRA testing center, according to BrokerCheck.
Derricotte had been at the firm for only one year. Prior to that, he was associated with J.P. Morgan Securities for one year (the company he was first registered with, in 2013 for less than a year) and, before that, Wells Fargo Advisors for two years, according to BrokerCheck.
On Aug. 22, 2019, Derricotte sat for the Uniform Combined State Law Examination (Series 66), during which he “possessed and accessed unauthorized materials, including personal notes, writing instruments, and a cellular phone,” according to FINRA.
On Sept. 16, 2019, Derricotte sat for the Uniform Investment Adviser Law Examination (Series 65), during which he “possessed and accessed unauthorized materials, including personal notes and a writing instrument,” the FINRA AWC letter said. His possession of, and access to, the unauthorized materials during the Series 66 and Series 65 exams violated FINRA Rule 2010 (governing standards of commercial honor and principles of trade), according to FINRA.
Both the Series 66 and Series 65 qualification exams are closed-book tests in which candidates are not permitted to possess, use or have access to prohibited items, FINRA pointed out. Candidates are provided with the only materials they are allowed to use during the exams, including dry-erase boards for notes and dry-erase markers to write on the boards, it said. Prior to the start of each of the exams, Derricotte “attested that he had read and would abide by” the FINRA Rules of Conduct that include not possessing or accessing prohibited items that also include recording devices, the FINRA AWC letter said.
However, during his Series 66 exam in August, Derricotte “possessed paper and writing instruments” and “used those materials to take personal notes and referenced those notes throughout the examination,” according to FINRA, which said a test center staff member “discovered and confiscated his writing instrument during the examination, but did not discover the notes he had taken.” That did not stop Derricotte, however, who then took a second unauthorized writing instrument from the desk of a test center staff member that he used to continue taking notes, the FINRA AWC letter said, adding Derricotte also “accessed his locker and his cellular phone during unscheduled breaks,” which were also prohibited.
During his Series 65 exam in September, Derricotte again possessed paper and a writing instrument, which he “referenced and used to take personal notes during the examination,” according to FINRA. A test center staff member “observed Derricotte’s use of the prohibited items during the examination and questioned Derricotte,” the FINRA AWC letter said, adding he “did not cooperate with the test center staff … and instead concealed the prohibited pieces of paper he had used to take notes in further violation of the Rules of Conduct.”