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Regulation and Compliance > Federal Regulation > FINRA

Ex-LPL Broker Fined, Suspended for Not Disclosing Child Sex Abuse Charge

By Jeff Berman

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The Financial Industry Regulatory Authority has suspended a former LPL Financial broker from associating with any FINRA member in all capacities for five months and fined him $5,000 for not disclosing he was charged with sex abuse of a child less than 12 years old, a felony.

Without admitting or denying the findings of a FINRA investigation, Thomas Vernor signed a FINRA letter of acceptance, waiver and consent on June 7 in which he consented to the  sanctions.

LPL and Vernor did not immediately respond to requests for comment on Friday.

Vernor first registered with FINRA in 1984, when he joined Morgan Stanley as a broker, according to his report on FINRA’s BrokerCheck website.

In August 2005, Vernor registered with FINRA as a general securities representative through an association with LPL, according to FINRA.

But, on March 6, 2023, LPL filed a Form 5 Uniform Termination Notice stating that Vernor voluntarily resigned on Feb. 21, according to FINRA.

Vernor is no longer registered as a broker or advisor, according to his report on BrokerCheck.

“Vernor willfully failed to amend his Uniform Application for Securities Industry Registration or Transfer (Form U5) to disclose a felony charge,” according to FINRA.

As a result, Vernor violated Article V, Section 2(c) of FINRA’s By-Laws and FINRA Rules 1122 (governing the filing of misleading information as to membership or registration) and 2010 (governing standards of commercial honor and principles of trade).

Article V, Section 2(c) of FINRA’s By-Laws requires registered reps to keep their Form U4 “current at all times,” and to file any necessary amendments the Form U4 “not later than 30 days after learning of the facts or circumstances giving rise to the amendment,” according to FINRA.

“Vernor learned that he was charged with a felony on April 1, 2022 [and] willfully failed to amend his Form U4 within 30 days to disclose the charge, as he was required to do,” according to the AWC letter. “Indeed, although Vernor knew he was required to disclose the felony charge, he chose, voluntarily, to never disclose it on his Form U4.”

FINRA’s investigation originated when it started investigating the Form U5 that was filed by LPL.

FINRA sign in Philadelphia. Photo: Adobe Stock

Jeff Berman

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