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Expunged Felony Conviction

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Jan 10, 2006 6:49 pm

Back in 2001 I was charged AND convicted of a felony possession in the state of CA.  (I was arrested for more, but the charges were dropped in lieu of a possession).

I plead nolo contendiare (no contest) (SP?) to the count. 

The charge was one that could later be reduced to a misdemeanor and expunged from my record, which I had done in 2004.

After reading online, and through the 1934 SEC act, it appears that any felony conviction requires 10 year statutory wait until entering into the securities industry.

I'm assuming and hoping the fact that it is expunged, means i can disclose it, but it shouldnt be a problem with the NASD, U-4, and hopefully specific exchanges NYSE etc.

I spoke to someone i know that works for a major Firm and they contacted their head of recruiting and she said that on the firms application i could put "no" because it has been expunged.

Anyone have any personal experience, or law advice of what to do for my U-4 and exchange applications?

I always hear its better to disclose, because they will find the fingerprint arrest records, and prefer knowing than to have a liar on their hands.

Jan 10, 2006 11:37 pm

Ive actually read the first reply, the second reply is new and pertains more to me...

Even though her crimes were "expunged" under 1203.4, i guess the NYSE and NASD still require that it be answered YES.

But if the statutory 10 year wait after any felony would apply to my case, where the felony has been expunged and has nothing to do with any ficuiciary responsibility or anything related to securities/money.

I'm calling the CRD tomorrow to get a more upfront answer.

Jan 10, 2006 11:47 pm

In the Act of 1934:

The Commission, by order, shall censure, place limitations on the activities, functions, or operations of, suspend for a period not exceeding twelve months, or revoke the registration of any broker or dealer if it finds, on the record after notice and opportunity for hearing, that such censure, placing of limitations, suspension, or revocation is in the public interest and that such broker or dealer, whether prior or subsequent to becoming such, or any person associated with such broker or dealer, whether prior or subsequent to becoming so associated--
(My paraphrase- if they feel that it is in the publics best interest, they can place limitations, censure, suspend, or revoke a brokers licence)

A. has willfully made or caused to be made in any application for registration or report required to be filed with the Commission or with any other appropriate regulatory agency under this title, or in any proceeding before the Commission with respect to registration, any statement which was at the time and in the light of the circumstances under which it was made false or misleading with respect to any material fact, or has omitted to state in any such application or report any material fact which is required to be stated therein.
(My Paraphrase: if I willfully mark NO, when i had indeed been charged/convicted with a felony, then i have done something misleading)

B. has been convicted within ten years preceding the filing of any application for registration or at any time thereafter of any felony or misdemeanor or of a substantially equivalent crime by a foreign court of competent jurisdiction which the Commission finds--
(My Paraphrase: if i have been convicted of a felony within 10 years, i can be censured/barred/ or limitations placed)

So I guess as long as I disclose the info... its up to them, I'll have to let you know, once i make some calls tomorrow

Jan 11, 2006 12:11 am deId=1110

I know i havent called yet, but it looks like the firm would have to file a special form because I would be disqualified:

Jan 31, 2006 11:33 pm

1/31/06 - update, Ive been speaking with someone at the NASD and they say they cant really tell me untill I actually apply and they see everything.  I even sent them the specific wording of my  expungement and felony... so once I apply I'll have to let youknow!

Jul 11, 2006 3:21 am

I was employed by a large top tier I-Bank and didn’t disclose my prior felony since it was dismissed. A month later, my arrest record came back because of the DOJ fingerprint cards and they asked why I lied in which I told them that it was dismissed. Since I was in a sensitive environment, I had to leave the premises until they finished their investigation.  Two weeks later, the firm said they weren’t willing to bond me regardless if my conviction was dismissed. Basically, they didn’t think I was worth it or they didn’t want someone with my past around there.

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Another example is that I applied to a very large Global Investment Firm through an agency after the first incident above. My interview went well and they were in the process of drafting the offer. I informed my recruiter about my prior conviction and the HR dept of the firm informed them that they weren't able to hire me. All they said is that it is best to apply later on and the conviction was only a few years ago.

Even though my conviction occurred when I was young, the circumstances involved, never did time in jail, conviction was dismissed after a year from the sentence date, great work experience in tech companies and after finishing college I was able to work for a large investment bank for several months in a visible role in which didn’t help my case in either circumstances above.

After doing research and speaking to top SEC attorneys it is still unclear if I can work in the securities industry since this issue is very complex. At this point and from personal experience is that it really depends on the firm if they are willing to go the extra mile to hire and fill out the additional paperwork to hire someone with a prior conviction. Additionally there’s the whole issue with the type of conviction and the statuary wait.

After 7 - 10 years (depending on how far the firm will go back) the arrest records won’t show up and by the time with good conduct and excellent employment experience it would be fine to apply again in the industry. I honestly decided to head in a different industry and put the financial services industry on hold until I decide its time to try again. My opinion now is too be honest and always disclose everything at this point since things will always appear.

Jan 3, 2011 9:13 pm

Hi! Few years ago I had a similar problem and I used one of the online websites that specializes in record clearing(Conveniently they are named and I can tell you they were really helpful. I had my criminal record cleared in less than a year. They were really cheap too( I not sure how much they are charging now). I also remember that they gave me a tons of tips for free before I even signed up with them. Give them a call and see what do they have to offer. Good luck!

Jan 4, 2011 1:32 am


Jan 4, 2011 2:15 am

Bob, that troll was actually pretty clever and good, and unfortunately, mentioned a product many visitors to this site might want to check out....

He must have used some search words to find this site, and the posts. Then he signs up using a financial name. Then, he uses proper english and highlights features and benefits while he's at it. Someone might want to recruit that fellow.

Feb 3, 2011 10:34 pm

Regardless if a felony case was expunged or sealed or downgraded, if you were ever charged with a felony, chances are that felony charge will show up on an FBI fingerprint search.  That could be the cause for a firm to term or deny employment because you would have answered NO on the Form U4 and that answer would have contradicted the FBI results.  It's a rather simple way of terming or denying a rep because the cause would be misrepresenting disclosure questions on the Form U4 without having to get into the nature of the case and the felony. 

Feb 16, 2011 4:52 pm

First off...I want to thank everyone for the information above. All fo the posters seem extremely knowledgeable. This looks like the perfect forum for my situation.

Back in 2000 I was convicted for Grand Theft in the amount of $2000. I was 19 years old. I worked at a bank and, along with other tellers, was reversing my service charges. Our local bank was acquired by Washington Mutual. Internal Affairs fired me and I was charged for theft. At court, the public defender had my case reduced to a misdemeanor (since I had no priors), and I was convicted. I spent 5 days in jail and then was released on an ankle monitoring program. I successfully completed the program on August 13, 2000 and made it through my probationary period. On September 29, 2009 I had the case expunged persuant to CA PC 1203.4. My record is completely clean other than this misdemeanor. 

Should I look into obtaining a Certificate of Rehabilitation or a Governors Pardon?

Now: I'm working on getting into the securities industry. In July, I was sponsored by a BD. FINRA ran the FBI print report and my arrests did come up. I obtained documents relating the arrests to the expunged case andsubmitted them to my BD. They sent me an email stating that ... "the 3 Disclosure Letter Inquiries from FINRA regarding CRD # 4950854, Ryan Logan, have been resolved.  No further action will be required." I don't know if this means that everything was resolved internally with the BD, or if FINRA actually approved me moving forward. I couldn't move forward with the firm because I am facing problems abtaining my insurance license. 

I am currently attempting to contract with LPL. I"m in the middle of filling out my U4 application through CRD. A Senior Registration Specialist at LPL has advised me that under 1203.4 I must disclose the misdemeanor. After reading the above, it sounds like I should always disclose the incident to all BD's that interview with as well as licensing agencies. Is this correct?

Would you advise that I seek legal counsel to help me with the disclosure forms that I will have to fill out on CRD? Can you recommend an attorney in the Los Angeles area that has experience in this area. I do have limited funds. I am new to all of this. I actually clicked on the link. Thanks for pointing out that it's not a legitimate avenue.

Thank you all for your posts!

Ryan L 

Mar 21, 2011 3:44 pm

pardons dont change the fact that you were arrested