The Wife Of The Customer At Dinner Who Was Not The Wife

July 18, 2013

So -- you take a client out to dinner with his wife. Except, ummm, that "wife" isn't actually his wife. But, hey, it's still a business meal and, well, you could sort of put the wife's expense on your firm's credit card. No?

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, Michael P. Duprey submitted a Letter of Acceptance, Waiver and Consent ("AWC"), which FINRA accepted. In the Matter of Michael P. Duprey, Respondent (AWC  2013036155801, July 9, 2013).

Duprey first became registered in 2001 and in October of that year, he registered with Charles Schwab & Co., where he remained until his March 2011 voluntary termination.  The AWC asserts that Duprey had no formal disciplinary history with the Securities and Exchange Commission, any self regulatory organization or any state securities regulator.

Dubious Dinner Diner 

The AWC alleges that on December 20, 2010, Duprey had dinner at a restaurant with a Schwab client and another non-client. Allegedly, Duprey paid for the dinner expenses on a Schwab business credit card, and, thereafter, he submitted an expense report falsely characterizing the non-client as the wife of the client. FINRA apparently deemed the expense report as materially false and inaccurate because of the mischaracterization of the non-client. 

SIDE BAR: Is FINRA implying that the "wife" was the client's girlfriend -- or was the "wife" simply another friend of Duprey's and asked along for the meal?  Was the client even married or did Duprey make up the whole wife thing? If the bogus wife was, in fact, the girlfriend of the customer, why would that necessary nullify the business nature of the the meal?  Ahh, so many questions and so few answers.


While associated with Schwab, Duprey maintained a personal email account in violation of the firm's written policies prohibiting such accounts being used to send or receive business related communications. The AWC alleges that from at least September 15, 2010 to about March 4, 2011, Duprey improperly used his personal email account to communicate with customers about business-related matters without his firm's knowledge or authorization. FINRA deemed that the cited conduct prevented Schwab from supervising business correspondence or preserving the communications in accordance with recordkeeping rules.

In accordance with the terms of the AWC, FINRA imposed upon Duprey a 6-month suspension from association with any member in any capacity and a $5,000 fine. 

Also READ:
SIDE BAR With Bill Singer (Thomson Reuters)

David Sobel, Esq., FINRA's Small Firm Advisory Board Chair, discusses with Bill Singer, Esq. the struggle of small broker dealers. Can the partnership of regulator and regulated be restored?. 


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