by Bill Singer
Old fashioned studying -- a thing of the past?
According to the Financial Industry Regulatory Authority (“FINRA”), David A. Kennedy entered the securities industry in 2005; and for the relevant period of February 2009 until December 11, 2009, he was associated with MetLife Securities, Inc. (“MetLife”).On August 14, 2009, FINRA received a Uniform Termination Notice for Securities Industry Registration (‘Form U5”), which stated that one of MetLife’s operation managers had improperly assisted Kennedy and others at MetLife with its Firm Element continuing education (“CE”) proficiency tests – prompting FINRA to investigate and subsequently file a Complaint on December 2, 2011. FINRA Department of Enforcement v. David A. Kennedy (Complaint, December 2, 2012; Default Decision, April 17, 2012 / FINRA Disciplinary Proceeding No.20090192761-05).
Pursuant to FINRA Membership and Registration Rule 1120(b), Metlife required all registered persons to complete an internal, computer-based Firm Element CE program on an annual basis, which was composed of web-based courses and accompanying proficiency tests that were completed on the firm’s internal computer system . Certain courses were pre-assigned to registered individuals based upon the registrations that they held at the time of assignment
Bill Singer
During July 2009, an Operations Manager purportedly provided him with the answers to the CE proficiency tests. In addition, Kennedy printed out answer sheets, which he was charged with providing to another registered representative to use while taking the same tests.
FINRA’s Complaint alleged that in accepting the CE answers from the Operations Manager and also providing answer sheets to another registered representative, Kennedy had engaged in conduct that was inconsistent with high standards of commercial honor and just and equitable principles of trade and therefore violated FINRA Rule 2010.
Respondent Kennedy did not answer the Complaint and, thereafter, did not enter an appearance. Accordingly, FINRA’s Department of Enforcement filed a Motion for Entry of Default Decision (“Default Motion”), which the Hearing Officer granted and resulted in the allegations being deemed admitted.
Although Enforcement recommended only a 60-day suspension and a $5,000 fine, the Hearing Officer apparently found exacerbating facts. In considering the sanctions to impose upon Kennedy, the Hearing Officer noted that:
Respondent clearly intended to cheat on the tests and assist others to do the same. The Hearing Officer finds no mitigating factors in the record. . .
Respondent did not just fail to complete MetLife’s Firm Element program; he cheated on a required element of the program and attempted to help another registered person do the same. The Hearing Officer concludes that this conduct evidences such a complete disregard for FINRA’s rules that a bar is necessary to protect the investing public.
Consequently, Kennedy was barred from associating with any FINRA-registered firm in any capacity.