In response to allegations of rule violations by the Financial Industry Regulatory Authority ("FINRA") but without admitting or denying the findings, Jason Pedigo proposed a settlement pursuant to a Letter Of Acceptance, Waiver And Consent ("AWC"), which self-regulatory organization accepted. In the Matter of Jason Pedigo, Respondent (AWC/2010025512501, September 15, 2011).
Pedigo entered the securities industry in April 2005 and subsequently became associated with four FINRA member firms, including Investment Professionals, Inc. ("IPI") from July 2006 to October 2010. Pedigo obtained Series 7, 31, and 66 securities licenses; and he had no prior disciplinary history.
According to the AWC, WL was a customer of Pedigo's at IPI. Pedigo claimed that in mid-August 2009, WL decided to purchase a fixed annuity, which the customer instructed Pedigo to purchase on August 31, 2009. Apparently in keeping with WL's instructions, on August 31, 2009, Pedigo submitted a fixed annuity contract for the customer with the Pacific Life Insurance Company ("Pacific Life"). Thereafter, Pacific Life issued the annuity contract and sent it to Pedigo in accordance with its selling agreement.
All well and fine and, frankly, quite mundane - except for this one, teeny weenie little old wrinkle: WL died on August 20, 2009.
Not surprisingly, Pacific Life never received WL's executed "Annuity Contract Confirmation" ("ACC"). I mean, sure, it's got to be difficult for a deceased individual to actually sign a contract confirming a purchase made after he died. However, mind you, on Wall Street, such things are not necessarily impossible. On the Street there's difficult and then there's impossible. Considering all the alchemy and voodoo that is part of the securities business, I'm figuring that getting a dead client to sign a confirmation of purchase is difficult, maybe even pretty difficult, but not impossible. All you need is a pen. Big deal. We could easily make this happen.
Pacific Life was quite persistent and the AWC alleged that the company mailed 11 letters to Pedigo requesting the return of WL's signed ACC.
On March 2, 2010, Pedigo contacted Pacific Life, informed the company that WL was deceased, and requested paperwork to submit a death claim. The AWC asserts that according to Pacific Life, it never received the death claim paperwork.
On August 26, 2010, about a year after WL's death and about a year after Pedigo submitted the fixed-annuity contract for the client, Pacific Life received a surrender request form and contacted Pedigo to inform him that a full surrender could not be processed. Why? Well, how about a little thing like WL was still dead. Just like Generalissimo Francisco Franco.
At this point, Pedigo had a number of options, some good, some bad. In the face of Pacific Life's refusal to process the surrender request because WL was dead, Pedigo decided to inform the company that, in fact, WL was still alive!
Ah ha! WL was no longer like Generalissimo Francisco Franco.
The AWC alleges that on August 30, 2010, Pedigo faxed Pacific Life an ACC purportedly signed by WL and dated September 8, 2009.
Okay, so, I'm flabbergasted by this.
In March 2010, Pedigo told Pacific Life that WL was dead, but in August 2010, the broker contended that the client was back among the living. Wow. Then it gets even more bizarre. In August 2010, Pedigo submits to Pacific Life an ACC that was supposedly signed by WL about 20 days after the client had died.
FINRA was not particularly impressed by the religious or supernatural possibilities of this case. In a somewhat grumpy, non-believer's sourpuss response, FINRA charged Pedigo with having violated its Rule 2010 and, in accordance with the AWC, Pedigo was barred from the industry.
Go figure, a broker brings a dead client back to life and the thanks that he gets for it is a Bar. No wonder so many stock brokers are leaving the industry. Too much damn regulation.