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, Jack R. Kapinus submitted a Letter of Acceptance, Waiver and Consent ("AWC"), which FINRA accepted. In the Matter of Jack R. Kapinus, Respondent (AWC 2010024376001, February 27, 2013).
Kapinus entered the securities industry in 1984, and between May 2003 and July 2010, he was registered as a General Securities Principal with FINRA member firm MML Investors Services, a subsidiary of MassMutual Financial Group. The AWC asserts that Kapinus had no prior relevant disciplinary history.
The AWC alleges that around September 2008,Kapinus, along with two registered representatives who worked at a branch office ran by Kapinus, decided to complete online examinations to becomeCertified College Planning Specialists ("CCPS"), a certification provided by the National Institute of Certified College Planners ("NICCP").
SIDE BAR: According to NICCP's website as of March 6, 2013 (and which could use a bit more proofreading):
[T]he NICCP fills the need that other college planning organizations don't. We give you financial stratgies[sic] to show familes [sic] how to pay the tuition bill. Because in the end, even if the family does qualify for some financial aid, they will still have to pay the college some money. Maybe a lot of money! That's where we shine!
Our "Certified College Planning Specialist" (CCPS) designation is the ONLY college planning certification recognized by both the CFP and CPA boards. Each board allows 16 hours of continuing education for passing the CCPS test. The CCPS brand is recognized as the "elite" in the college planning industry and most parents check our "Find an Advisor" area before hiring a college planner to insure they are working with a certified trained professional . . .
Two Out Of Three?
The AWC alleges that the two registered persons passed their CCPS examinations but that one or both of them took and passed the same examinations for Kapinus. Although all three cited individuals obtained CCPS certification, the AWC alleges that, in fact, Kapinus never actually sat for the exams.
For unexplained reasons in the AWC, sometime around May 9, 2010, MassMutual representatives arrived at Kapinus' branch office to investigate, among other things, whether he had actually taken the CCPS exam. In furtherance of that investigation,Kapinus met with and directed the two registered persons cited above to provide the MassMutualinvestigators with written statements that Kapinushad, in fact, taken and passed the CCPS examination, which occurred. Shortly thereafter near May 21st,Kapinus provided the MassMutual investigators with a written statement that falsely reported that he had taken the CCPS examination.
SIDE BAR: Online FINRA records disclose as of March 6, 2013, that Kapinus had been discharged by MML Investors Services, Inc. on June 27, 2010, based upon this:
TERMINATED IN CONNECTION WITH AN INTERNAL REVIEW OF ALLEGATIONS RELATING TO CERTIFICATION EXAMINATIONS AND TAX ISSUES.
Based on the foregoing, FINRA alleged that Kapinus violated FINRA Rule 2010. In accordance with the terms of the AWC, FINRA imposed upon Kapinusa
What remains unclear to me is what first tipped off MassMutual to Kapinus's alleged duplicity - notwithstanding the mystery, compliments to MassMutual for policing its associates. As to how things jumped from MassMutual to FINRA is also an unanswered question. More importantly, notwithstanding that Kapinus agreed to the AWC, we truly don't know whether someone blew the whistle on this respondent or what, if any, smoking gun was found.
While it is clear that the AWC has alleged that one or two other individuals may have taken the certifying examination for Kapinus, we are not told that either of those folks admitted as much. Call it mere curiosity but I would still like a tad more background to understand what proof was relied upon in alleging the underlying misconduct. This a case that alleges A, charges C, but leaves out the interim step of B.
As part of my tireless effort on behalf of "Street Sweeper" readers to ferret out a story, I visited the NICCP website and found this description on the organization's webpage titled: The Certified College Planning Specialist (CCPS) Certification Program (and once again, a tad more proofreading would be advised):
The need for what we do is huge!
The results we can provide are incredible, desirable and valuable! With today's high cost of college, many families are desperately seeking help to reduce college costs and pay the balance more effeciently [sic] without getting buried in debt. Most families don't know where to turn.
Upon completion of the Certification program you will receive a wood framed and matted CCPS Certification suitable for hanging in the nicest of offices. Here's what one new member commented…
"WOW! What a beautiful certificate! I did not expect it… What a confidence booster! My kids were so impressed, too! THANK YOU!" Katherine O'Brien,San Diego, CA
Reducing the cost
The CCPS certification program is designed for financial planners who want to actively assist families in reducing the financial impact of sending children to college while preserving their lifestyle and their other financial priorities!
The purpose of the CCPS certification program is to provide designees with the knowledge and resources necessary to be effective in showing families new and creative ways of reducing the financial impact of college… without going broke.
As a member of the NICCP, designees have access to the ongoing training and the diagnostic tools needed to help families of all incomes! Using financial aid strategies, cash flow strategies, tax capacity planning and investment planning, and exit strategies, CCPS designees can make college more affordable for everyone.
Certified College Planning Specialists
CCPS designees enjoy the dedicated support of an organization and program founded entirely on the principles of ongoing professional education and vocational excellence within the specialized area of college financial planning.
Given the strict pre-qualification requirements, along with the rigorous testing, your CCPS certification is a symbol of knowledge, experience, expertise, and professionalism that will surely differentiate you from other financial advisors.
Frankly, a commendable financial specialty to be in a position to help young families prepare for the challenge of putting aside adequate college funds; and, hopefully, the CCPS program is a tad more efficient (rather than "effecient") in accomplishing those goals than the disconcerting typos on the NICCP website might suggest. Of course, the one thing that truly perplexed me is that such a useful certification has been reduced to a seeming quest to earn a "wood framed and matted CCPS Certification suitable for hanging in the nicest of offices" which serves as some odd "confidence booster." I mean, really?
As "Street Sweeper" has often demonstrated, exam cheating is not a particularly isolated fact pattern on Wall Street. If you can think of a variation on the theme of cheating, chances are, someone has already done it. Word to the wise: STUDY!
READ, these "Street Sweeper" columns: