An irreverent Wall Street Blog
by Bill Singer
by Bill Singer
Stockbroker Fined And Suspended For Undisclosed Tax Liens
October 9, 2013
It happens. You fall behind. Car payments. Credit Cards. Mortgage. Taxes. You try to tap dance through it but the lawsuits pile up and crash down upon you in the form of judgments and liens. If you're lucky and you still have your Wall Street job, you struggle under the debt and find a way to stay afloat. You may try for a workout of your debts. You may toss in the towel and file for bankruptcy. For those in the biz, however, you must timely amend your Form U4 to disclose the bankruptcies, judgments, and liens. If you don't and get caught, bad is going to get a whole helluva lot worse.
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, Ambiorix Jaquez submitted a Letter of Acceptance, Waiver and Consent ("AWC"), which FINRA accepted. In the Matter of Ambiorix Jaquez, Respondent (AWC 2013037424201, October 3, 2013).
Jaquez first became registered in 2000 and was affiliated with several FINRA member firms. In May 2013 he was registered with Legend Securities, Inc. ("Legend") until his August 12, 2013, termination. The AWC asserts that Jaquez had no relevant prior disciplinary history.
Tower of Liens
The AWC asserts that the following tax-related filings occurred on the dates noted agtainst Jaquez'
- $2,154: New York State Tax Lien, February 15, 2006;
- $7,645: Internal Revenue Service Tax Lien, October 11, 2006;
- $990: New York State Tax Warrant, January 23, 2007; and
- $1,579: New York State Tax Warrant, November 28, 2009.
Additionally, the AWC asserts that on May 18, 2010, a civil judgment was entered against Respondent for $3,469.
Ticking Clock of Disclosure
Article V of FINRA's By-Laws: Registered Representatives and Associated Person, provides as follows:
Application for RegistrationSec. 2. (a) Application by any person for registration with the Corporation, properly signed by the applicant, shall be made to the Corporation via electronic process or such other process as the Corporation may prescribe, on the form to be prescribed by the Corporation and shall contain:(1) an agreement to comply with the federal securities laws, the rules and regulations thereunder, the rules of the Municipal Securities Rulemaking Board and the Treasury Department, the By-Laws of the Corporation, NASD Regulation, and NASD Dispute Resolution, the Rules of the Corporation, and all rulings, orders, directions, and decisions issued and sanctions imposed under the Rules of the Corporation; and(2) such other reasonable information with respect to the applicant as the Corporation may require.(b) The Corporation shall not approve an application for registration of any person who is not eligible to be an associated person of a member under the provisions of Article III, Section 3.(c) Every application for registration filed with the Corporation shall be kept current at all times by supplementary amendments via electronic process or such other process as the Corporation may prescribe to the original application. Such amendment to the application shall be filed with the Corporation not later than 30 days after learning of the facts or circumstances giving rise to the amendment. If such amendment involves a statutory disqualification as defined in Section 3(a)(39) and Section 15(b)(4) of the Act, such amendment shall be filed not later than ten days after such disqualification occurs.
In addition to the above By-Law provision, FINRA also requires the observance of this rule:
FINRA Rule 1122. Filing of Misleading Information as to Membership or RegistrationNo member or person associated with a member shall file with FINRA information with respect to membership or registration which is incomplete or inaccurate so as to be misleading, or which could in any way tend to mislead, or fail to correct such filing after notice thereof.
Finally, the Uniform Application For Securities Industry Registration Or Transfer ("Form U4") asks the following:
Financial Disclosure14K. Within the past 10 years:(1) have you made a compromise with creditors, filed a bankruptcy petition or been the subject of an involuntary bankruptcy petition?(2) based upon events that occurred while you exercised control over it, has an organization made a compromise with creditors, filed a bankruptcy petition or been the subject of an involuntary bankruptcy petition?(3) based upon events that occurred while you exercised control over it, has a broker or dealer been the subject of an involuntary bankruptcy petition, or had a trustee appointed, or had a direct payment procedure initiated under the Securities Investor Protection Act?14L. Has a bonding company ever denied, paid out on, or revoked a bond for you?14M. Do you have any unsatisfied judgments or liens against you?
Out The Door
Online FINRA documents as of October 9, 2013, disclosed that
on August 12, 2013, Legend terminated Jacquez's registration pursuant to a "Permitted
to Resign," based upon "ALLEGATIONS" that:
MR. JAQUEZ FAILED TO DISCLOSE SEVERAL TAX LIENS, A STUDENT LOAN DEFAULT LIEN AND A JUDGEMENT FROM A COLLECTION COMPANY.
The "SUMMARY" provided with the online documents adds the
following:
ON NOVEMBER 14, 2012, FINRA INFORMED MR. JACQUEZ THAT THERE WERE 3 NYS TAX LIENS, ONE IRS LIEN, A STUDENT LOAN DEFAULT LIEN AND A LIEN FROM A COLLECTION AGENCY THAT WERE DISCOVERED DURING A ROUTINE EXAMINATION OF HIS PREVIOUS EMPLOYER. IN A RESPONSE DATED DECEMBER 20, 2012, MR. JAQUEZ RESPONDED TO FINRA IN REGARDS TO THESE LIENS. MR. JAQUEZ NEVER DISCLOSED THE LETTERS OR THE LIENS TO LEGEND SECURITIES.
The AWC alleges that Jaquez was aware of the cited liens and judgment and had entered into payment plans to satisfy them; however, he willfully failed to amend his Form U4 to disclose the matters, in violation of Article V, Section 2 of the NASD and FINRA By-Laws, NASD Conduct Rule 2110, NASD IM-1000-1, and FINRA Rules 1122 and 2010.
In accordance with the terms of the AWC, FINRA imposed upon Jaquez a $5,000 fine and a two-month suspension in all capacities from association with any FINRA member firm.
Also READ:
- Untimely Disclosures Of Tax Liens And Bankruptcies
- Tax Liens And Judgments Snare Stockbroker
- LPL Broker Tripped Up By Undisclosed IRS Tax Lien
- Undisclosed Tax Liens And State Regulatory Action Trip Up Stockbroker
- Undisclosed Bankruptcies,Tax Liens and Judgments Derail Stockbroker
- Statutory Disqualification for Undisclosed Tax Liens Sustained by FINRA, SEC, and Federal Court
- Undisclosed IRS Liens on Form U4 Result in FINRA Fine and Suspension