SIDE BAR: Pursuant to FINRA Rule 3280 (and former NASD Rule 3040), it is incumbent upon associated persons to provide to their FINRA member firm prior written notice describing in detail a proposed PST:FINRA Rule 3280: Private Securities Transactions of an Associated Person states:(a) ApplicabilityNo person associated with a member shall participate in any manner in a private securities transaction except in accordance with the requirements of this Rule.(b) Written NoticePrior to participating in any private securities transaction, an associated person shall provide written notice to the member with which he is associated describing in detail the proposed transaction and the person's proposed role . . .
[A]s a result of Yip's actions, the Firm terminated Yip's employment and partially reimbursed the customer for her losses. Yip agreed to indemnify his former co-branch manager for the Firm's payment to the customer.
Respondent has submitted a sworn financial statement and demonstrated an inability to pay full restitution immediately upon issuance of the AWC. In light of the financial status of respondent, restltution of $5,000 to customer T.C. shall be payable in five $1,000 installments, plus a sixth and final payment consisting of accrued interest as described above, commencing with the first payment to be made on the 15th day of the month following notice that this AWC has been accepted. Interest shall continue to accrue as described above.Respondent shall submit satisfactory proof of payment of restitution or of reasonable and documented efforts undertaken to effect restitution after each payment due under the installment plan . . . and includes a copy of the check. money order or other method of payment or by e-mail, with pdf copies of the payment documentation . . . This proof shall be provided to the FINRA staff member listed above no later than 15 days after each payment is due.If for any reason Respondent cannot locate customer T.C. after reasonable and documented efforts within 15 days from the date each payment is due under the installment plan, or such additional period agreed to by a FINRA staff member in writing, Respondent shall forward any undistributed restitution and interest to the appropriate escheat, unclaimed property or abandoned property fund for the state in which the customer is last known to have resided. Respondent shall provide satisfactory proof of such action to the FINRA staff member identified above and in the manner described above, within 14 days of forwarding the undistributed restitution and interest to the appropriate state authority.Respondent has specifically and voluntarily waived any right to claim an inability to pay at any time hereafter the monetary sanction(s) imposed in this matter.The imposition of a restitution order or any other monetary sanction herein, and the timing of such ordered payments, does not preclude customers from pursuing their own actions to obtain restitution or other remedies. . .
Breach of Contract, Unjust Enrichment and Restitution, Violation of Washington Consumer Protection Act RCW 19.86.020, Negligence, Respondent Superior.
Advisor was terminated for activity related to a client initiated litigation involving an investment sold away from the Firm.
What happened to T.C.'s $50,000 investment -- did the company fail to repay any of the convertible promissory note when the two-year maturity was reached? By the time the two-year term expired, was the weight management company bankrupt, insolvent, or seeking a delay in repayment?How much did Raymond James' "partial" reimbursement amount to and what, if anything, happened to the balance of T.C.' s non-reimbursed losses/claims? Was Raymond James' $25,000 court settlement the referenced "partial" reimbursement or T.C.'s $50,000 investment, or was that in addition to the reimbursement?The AWC asserts that Yip agreed to indemnify Raymond James' "partial" reimbursement. Did Yip fully repay his former employer for its unstated reimbursement to T.C.? Did Yip's indemnification promise to his manager cover the $25,000 settlement notwithstanding that the BrokerCheck disclosure asserts that he did not "contribute" to that payment?As to the AWC's ordered $5,000 restitution, how did FINRA come up with that number? Was that the shortfall incurred by T.C. after receiving Raymond James' partial reimbursement and the $25,000 settlement; or had Yip made payments to T.C. in addition to the $25,000 settlement?