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Finra Inquiry on 3070 Disclosure

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Mar 11, 2009 9:20 pm

I made an error in judgement over a year ago in a client’s fixed income account by reinvesting a called bond into a similar bond without the client’s authorization.  It’s a long story but the reinvestment of the bond was consistent with the client’s previous approved trades and risk profile.  A complaint was filed, my firm investigaged it, I received a letter of reprimand and was put on a 5 day leave of absence.  The client agreed to a settlement of a return of one half the sales charge which was executed about a month ago.    U-4 was updated immediately upon the settlement.

  I was under the impression the matter was resolved.  Now, today in the mail I receive an inquiry with respect to a 3070 Disclosure Filing from FINRA.  They are asking almost all the same questions my form did in regards to the complaint.  Do I take this to mean this issue is not resolved or it is expanding some how?  I and my firm reported everything to FINRA on a timely basis and the client is satisfied.   What is my liability and do I need an attorney to respond.  For some reason or other I fell like I am getting set up to be hung out to dry on a resolved issue.   Thanks for your thoughts.
Mar 11, 2009 10:02 pm

I would take the letter to your firms compliance department to see what they suggest.