Lovebirds (Photo credit: Nita W)
In response to the filing of a Complaint on November 5, 2012, by the Department of Enforcement of the Financial Industry Regulatory Authority ("FINRA"), Respondent Ezra Demetrius Suber submitted an Offer of Settlement dated December 16, 2012, which the regulator accepted. Under the terms of the Offer of Settlement, without admitting or denying the allegations in the Complaint, Respondent Ezra Demetrius Suber consented to the entry of findings and violations and to the imposition of the sanctions. FINRA Department of Enforcement, Complainant, vs Ezra Demetrius Suber, Respondent (Offer of Settlement, 2010025041602, January 3, 2013).
Suber was registered with PFS Investments Inc. ("PFS") from June 20, 1994 until December 13, 2010, when he was permitted to resign. By 2010, Suber was working only part-time at PFS selling insurance, variable annuities and mutual funds.
In May 2010, a PFS customer of Suber's purchased a MetLife variable annuity. In and of itself, not exactly a stunning revelation. What gets interesting is the assertion in the Offer of Settlement that following this annuity purchase, the customer and Suber began a romantic relationship. Nothing like a little bit or romance on Wall Street.
In June 2010, the customer allegedly gave Suber $2,000 in cash to invest on her behalf. Although the two lovebirds had apparently discussed a number of investment options and Suber promised to use the two grand for investment purposes, the stockbroker apparently pocketed the cash by making a deposit into his personal bank account - by month's end he withdrew the $2,000 from his account and used the funds to pay his personal expenses. Yup - not a penny ever wound up invested on behalf of his supposed girlfriend/customer and, to boot, he somehow never quite managed to tell her what he had done with her money.
You might ask why? The answer would likely be "who knows," but keep in mind that from at least July 20, 2005, through August 5, 2008, Suber had failed to timely report seven liens or judgments on his Uniform Application For Securities Industry Registration Or Transfer (the "Form U4″). Ultimately, the Offer of Settlement alleges that Suber willfully failed to timely report these liens or judgments - which ran from a low of $493.57 for a civil judgement in favor of a dentist to a high of $49,728 for an IRS tax lien. The range of tardy reporting ran from 40 to 3,520 days late.
The Offer of Settlement alleged that the conversion of the girlfriend/customer's funds constituted a violation of FINRA Rule 2010. As a result of the untimely Form U4 disclosures, Suber was deemed to have willfully violated Article V, Section 2(c) of the NASD and FINRA By-Laws of the Corporation and NASD IM-1000-1 and Rule 2110. In accordance with the terms of the Offer of Settlement, FINRA imposed upon Suber a Bar from associating with any FINRA member.
According to online FINRA documents as of January 11, 2013, PFS received a customer complaint on November 11, 2010, which alleged that:
CUSTOMER ALLEGES THAT $2,000 GIVEN TO REPRESENTATIVE WAS NEVER INVESTED AND THAT VARIABLE ANNUITY RECOMMENDATION DID NOT FIT HER AGGRESSIVE GROWTH INVESTMENT OBJECTIVE.
The online disclosure states that the complaining customer sought $13,146.66 in damages and the the firm settled on November 17, 2010, for $4,750.
Another online FINRA disclosure states that Suber was permittd to resign on December 13, 2010, based upon allegations that:
THE AGENT WAS PERMITTED TO RESIGN AFTER A CUSTOMER ALLEGED THAT $2,000 GIVEN TO REPRESENTATIVE WAS NEVER INVESTED AND THAT VARIABLE ANNUITY RECOMMENDATION DID NOT FIT HER AGGRESSIVE GROWTH INVESTMENT OBJECTIVE - SEE RELATED FORM U4 PREVIOUSLY FILED
PFS further noted that:
OUR FIRM SETTLED THE MATTER FOR THE AMOUNT OF $4750.00 - SEE RELATED FORM U4 PREVIOUSLY FILED.