California Stockbroker Discipline Report for the First Quarter of 2011

Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for warning_flag.jpgThe following information regarding broker misconduct and disciplinary actions taken against California stockbrokers was released by the Financial Industry Regulatory Authority (FINRA) in January, February, March and April 2011:

Michael Timothy Rodman, with USA Advanced Planners, Inc. in Rancho Santa Fe, California, was suspended from association with any FINRA member for 10 business days in connection with the execution of variable life settlement transactions and charging of excessive commissions.

Paul Richard Soto, formerly with Metlife Securities Inc. in Sacramento, California, was suspended from association with any FINRA member for 10 business days and fined $5,000 in connection with a finding that he exercised discretions in customer accounts without written authorization from his firm.

Robert John Zamecki, with Lighthouse Capital Corporation in Oakland, California, was suspended from association with any FINRA member for 30 days and fined $12,500 in connection with a failure to supervise a registered representative’s private securities transactions.

Allen Michael Kay, formerly with Wachovia Securities, LLC in Bermuda Dunes, California, was suspended from association with any FINRA member for one year and fined $50,000 in connection with misleading risk-averse customers to invest in mutual funds that did not comply with their investment objectives or risk tolerance. Kay allegedly misrepresented the nature of the investment, leading his customers to believe that they were being place in the type of safe and secure investments they were interested in such as government bonds or bank instruments.

Hansel Clarence Cua Lee, formerly with Morgan Stanley & Co. Incorporated in Glendale, California, was barred from association with any FINRA member in connection with the sale of $500,000 worth of Treasury and municipal securities in a customer’s account without the permission of the customer and requested that a check be drawn for the $500,000 to be made payable to a company in his ownership and control.

Timothy Robert Mays, formerly with Financial Network Investment Corporation in Santa Barbara, California, was suspended from association with any FINRA member for eight months and fined $5,000 in connection with the falsification of firm records of client accounts including, when customers did not sign necessary documents, placing the signatures himself rather than giving those documents back to clients to sign.

Matthew David Osborn, formerly with Edward Jones in Yreka, California, was suspended from association with any FINRA member for 10 business days and fined $5,000 in connection with exercising discretion in a customer account without the customer’s authorization.

Lawrence Ira Goldstein, with Oppenheimer & Co. Inc in Los Angeles, California, was suspended from association with any FINRA member for 10 business days and fined $6,623 in connection with the recommendation of unsuitable investments for his customer that were contrary to that customer’s investment objectives. Goldstein allegedly recommended that the customer invest in auction rate securities and preferred securities that were rated below investment grade.

Stuart Phillip Miller, formerly with Merrill Lynch, Pierce, Fenner & Smith Incorporated in La Jolla, California, was suspended from association with any FINRA member for one year and fined $10,000 in connection with the joint solicitation and handling of customer accounts with another individual – where Miller and the individual created a model fund portfolio to present to potential customers and misrepresenting that they managed the portfolio. Miller and the individual failed to include any information about risk associated with the funds in the portfolio.

Mission Securities Corporation in San Diego, California, was expelled from FINRA membership and Registered Principal, Craig Michael Biddick in Rancho Santa Fe, California, was barred from association with any FINRA member. Both Biddick and Mission Securities were ordered to pay $38,946.06 to firm customers in connection with the misuse of customer securities.

Daniel A. Contreras, formerly with Multi-Financial Securities Corporation in Ontario, California, was barred from association with any FINRA member in connection with recommending customers to invest in promissory notes not approved by his member firm. The company that issued the promissory notes filed for Bankruptcy and Contreras’ customers lost all of their investment.

Alvin Waino Gebhart Jr., formerly with AFA Financial Group, LLC in Calabasas, California, was barred from association with any FINRA member and Donna Traina Gebhart, formerly with AFA Financial Group, LLC in Calabasas, California, was suspended from association with any FINRA member for one year and fined $15,000 in connection with engaging in private securities transactions without approval of their firm.

Richard Mark McKinnon, formerly with First Allied Securities, Inc. in Sacramento, California, was barred from association with any FINRA member in any capacity in connection with the recommendation of bonds, bond funds and annuities to an elderly customer who entrusted funds to make the investment with McKinnon. According to the findings, McKinnon deposited the customer’s funds in his personal bank account and improperly used the funds for personal expenses.