finra

FINRA

 

 

FOR RELEASE:
CONTACTS:

Tuesday, December 7, 2004
Herb Perone (202) 728-8464

Sarah Bohn (202) 728-8988

 

 

 

NASD Bars Broker For Charging Fraudulent Mark-Ups

Washington, D.C – NASD announced today that it has barred John Van, principal of Murphy Van Securities, Inc. of Clifton Park, NY and an upstate New York radio personality, for knowingly charging fraudulent and excessive mark-ups on Treasury Notes to a disabled customer and for making misrepresentations to the customer’s attorney. Van’s radio program, The Murphy Van Financial News Hour, was broadcast until recently on WCSS AM 1240 in Amsterdam, NY and on WENT AM 1340 in Gloversville, NY.

 

The NASD found that in January 2004, a custodial account was opened at Murphy Van Securities, Inc. for a completely incapacitated individual in a vegetative state who had received a multi-million dollar settlement in connection with a medical malpractice lawsuit.  Approximately $3.3 million from the malpractice settlement was deposited in the custodial account.
   
NASD’s investigation revealed that in obtaining the account, Van misrepresented to the customer’s counsel that transaction fees would not exceed 1 percent. In fact, he began charging transaction fees in the form of mark-ups ranging from 2.936 percent to 3.054 percent. NASD found that Van knowingly charged fraudulent and excessive mark-ups on three U.S. Treasury Note transactions that had an aggregate value of approximately $3.3 million. The fraudulent and excessive markups on those transactions totaled approximately $64,000.

 

In settling this matter, Van neither admitted nor denied the charges.

 

Investors can obtain more information about, and the disciplinary record of, any NASD-registered broker or brokerage firm by using NASD's BrokerCheck.  NASD makes BrokerCheck available at no charge to the public.  In 2003, members of the public used this service to conduct more than 2.8 million searches for existing brokers or firms and requested almost 180,000 reports in cases where disclosable information existed on a broker or firm.  Investors can link directly to BrokerCheck at www.nasdbrokercheck.com.  Investors can also access this service by calling 1-800-289-9999.

 

NASD is the leading private-sector provider of financial regulatory services, dedicated to investor protection and market integrity through effective and efficient regulation and complementary compliance and technology-based services.  NASD touches virtually every aspect of the securities business - from registering and educating all industry participants, to examining securities firms, enforcing both NASD rules and the federal securities laws, and administering the largest dispute resolution forum for investors and member firms.  For more information, please visit our Web Site at www.nasd.com.