June 7, 2012
For the purpose of proposing a settlement of rule violations alleged by the Financial Industry Regulatory Authority ("FINRA"), without admitting or denying the findings, prior to a regulatory hearing, and without an adjudication of any issue, Jose Guillermo Delmendo submitted a Letter of Acceptance, Waiver and Consent ("AWC"), which FINRA accepted. In the Matter of Jose Guillermo Delmendo,Respondent (AWC 2011028822001, June 1, 2012).
Delmendo was registered with with Farmers Financial Solutions, LLC as an Investment Company and Variable Contracts Products Representative from February 15, 2011 until August 3, 2011.
The AWC asserts that if Delmendo maintained a minimum number of insurance policies in force, he was eligible to receive a monthly subsidy payment from Farmers Insurance Group, . Unfortunately, the AWC alleges that in order to maintain such payments, Delmendo forged the signatures of at least 29 individuals on subscription agreements for renters' insurance policies issued by Farmers' Insurance Group. The policies submitted were the least expensive available, with low coverage and high deductibles; moreover, many of those individuals whose signatures were forged were tenants living at properties owned by Delmendo's family or friends. The AWC alleges that Delmendo personally paid about $18 per policy to cover the initial fees/premiums, and submitted the fictitious applications to Farmers' Insurance Group.
As a result of Delmendo's alleged actions, he received about $6,000 in subsidy/commission payments, which he purportedly used to pay for the operating expenses of his insurance business and ordinary living expenses.
FINRA deemed the forgeries and policy submissions as constituting violations of FINRA Rule 2010. In accordance with the terms of the AWC, FINRA imposed upon Delmendo a bar from associating with any FINRA member.