The Financial Industry Regulatory Authority has suspended a former Raymond James representative for four months and ordered him to pay $10,000 for taking confidential client information — via unencrypted emails and pictures — to his new firm, Piper Sandler.
According to FINRA's order, from September 2012 to September 2023, Sam Calvin Nevels was registered as a general securities rep with Raymond James & Associates Inc.
On Sept. 11, 2023, Raymond James filed a Form U5 disclosing that Nevels had voluntarily terminated his association with the firm. On Oct. 4 of that year, the firm filed a Form U5 amendment stating that it initiated an internal review concerning Nevels' "potential retention and transmission of confidential firm information and client information; potential conduct inconsistent with firm policies on document integrity."
On Jan. 29, 2024, Raymond James filed a Form U5 amendment disclosing that Nevels "retained and transmitted confidential and proprietary firm information and confidential client information, and that [Nevels] altered customer information in firm records."
Unencrypted Emails
From June 2023 to September 2023, before leaving Raymond James for Piper Sandler, according to his BrokerCheck profile, "Nevels improperly took confidential and proprietary information from Raymond James' systems, including nonpublic information about Raymond James' customers, by emailing it to his personal email address, by printing and retaining documents, and by retaining pictures taken of RJA's system," FINRA's order states.
The information "was directly relevant to Nevels' new position, and he accessed some of the information after moving to the new firm," the order continues.
Further, Nevels "altered information in RJA's contact management system by deleting certain information and replacing it with false information," according to the order.
Nevels and a fellow Raymond James employee — who left the firm with Nevels — worked in Raymond James' Fixed Income Institutional Sales Division, selling fixed income securities to institutional clients such as banks and credit unions.
Between June 2023 and September 2023, after they had begun negotiations to become associated with Piper Sandler, "Nevels sent over 30 unencrypted emails to his personal email address," the order states. "These emails contained, among other things, institutional client information, including contact lists generated from the firm's customer contact system, presentations made to customers, and details of transactions that customers were considering."
Nevels also printed and retained documents containing Raymond James' "confidential and/or proprietary information and retained five photographs of information on RJA's computer system screens and four screen shots of firm emails, three containing client contact information and one with details of an RJA investment product," according to the order.
For example, Nevels printed client data from the firm's contact management system for 41 institutional clients on Aug. 22, 2023, and took it with him when he left the firm. The data included "client financial information maintained in RJA 's files, contact information, and notes of RJA's interactions with the clients."
On Sept. 1, 2023, Nevels and the registered rep resigned from Raymond James to become associated with Piper Sandler, where they continued to work selling fixed income securities to many of the same institutional clients.
Within days of starting at his new firm, Nevels accessed some of the improperly removed materials, including a client contact list (which he shared with the registered rep) and a presentation that he and the rep created for a client while they were at Raymond James, using the new firm's email system, the order maintains.
Legal Action
Nevels also entered some contact information from the materials into his new firm's customer relationship management software, the order states.
Shortly thereafter, Raymond James took legal action to prevent Nevels and the rep from using its materials at their new firm.
On Aug. 28 and 29, 2023, Nevels altered client contact data in Raymond James' contact management system, according to the order.
For one institutional client, Nevels altered contact information for two individuals, the chief financial officer and the controller. "Nevels changed their names, deleted their email addresses and job titles, and changed their telephone numbers," FINRA said.
For another institutional client, Nevels changed the name of the contact person, deleted the email address and changed the telephone number.
For a third institutional client, Nevels deleted the contact person's mobile telephone number and changed the work telephone number.
"Changing the client contact information caused inaccuracies in RJA's contact management system and could have made it more difficult for RJA to reach out to the clients before the departing representatives had a chance to contact them," the order states. "In each instance where Nevels changed a client's contact information, the new information was incorrect."
Nevels accepted and consented to FINRA's findings without admitting or denying them.
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