The explanation given for a former Edward Jones advisor’s dismissal was defamatory and should be expunged, an industry arbitrator ruled last week.
Edward Jones told regulators in 2013 on a Form U5 that Matthew Hawk was terminated for providing inaccurate information on a client’s life insurance application.
A Financial Industry Regulatory Authority arbitrator decided last week the explanation should now say Hawk “was improperly investigated for an exaggerated claim of having committed fraud.”
The brokerage, explaining Hawk’s firing, had said the advisor indicated on a life insurance application that a client hadn’t used tobacco products when another insurer had rated him a tobacco user, Securities and Exchange Commission records show.
At the time, Hawk, now senior wealth advisor with Cambridge Capital Management, explained that during an insurance application review, an insurance company found the client “had smoked a couple cigarettes a few months back.”
While the insurer rated the client a smoker, a representative from that company said another insurer may look at the situation differently, Hawk told authorities.
“Based on this explanation, I submitted a different application to a second life insurance company as a non-smoker on behalf of the client,” he said. Hawk also sent an email to the insurer along with the application explaining the client’s situation, but said Edward Jones fired him because he didn’t put that information directly on the application.
Hawk filed a claim in November with FINRA requesting the form disclosing his termination be expunged. The arbitrator recommended the explanation be expunged “based on the defamatory nature of the information.”
While the reason for termination should remain the same, the explanation “shall be deleted in its entirety and replaced with the following language: ‘Mr. Hawk was improperly investigated for an exaggerated claim of having committed fraud. No customers were involved, there were no acts of wrongful taking of property, violation of investment-related statutes, regulations or rules and no SEC or FINRA rules, codes or policies were violated by Mr. Hawk.’”
Hawk and Edward Jones didn’t immediately respond to emails requesting comment. InvestmentNews reported on the matter Monday.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.