finra

FINRA

For Release:
Contact:
Tuesday, August 11, 2009
Herb Perone (202) 728-8464

 

 

FINRA Bars AGSI Broker for Misappropriating $90,000 Inheritance From Two Sisters

Washington, D.C. — The Financial Industry Regulatory Authority (FINRA) announced today that it has barred Richard L. Wood, a Miamisburg, Ohio, broker, from the securities industry for stealing a $90,000 inheritance two sisters received from a deceased aunt and using it for his own purposes.

 

FINRA also found that Wood created and sent false account statements in order to cover up his theft. At the time, Wood worked for American General Securities Inc.

 

"All investors are entitled to rely upon brokers to uphold high standards of commercial honor in their dealings with them," said Susan L. Merrill, Executive Vice President and Chief of Enforcement. "Preying upon these two sisters by stealing from their accounts and then doctoring documentation with the intent to mislead them is an egregious breach of ethical standards."

 

FINRA found that in August 2006, one of Wood's customers passed away, leaving the two victims, her nieces, as beneficiaries of her estate. While helping liquidate the estate, Wood recommended that each of the sisters open a brokerage account with him and invest in bonds. But Wood did not open the brokerage accounts or invest in bonds. Instead, he misappropriated the funds by instructing the sisters to make their checks payable to an entity under Wood's sole control — STL Financial, Inc. — instead of payable to a bona fide brokerage firm.

 

In order to cover up his theft of the funds, Wood provided each sister with a false account number for a fictitious brokerage account. In late 2007, one of the sisters became concerned that she had received no documentation regarding the account and investment in bonds. She contacted Wood who assured her that she would receive written confirmation. After repeated requests, Wood created a false customer account statement and sent it to her, following up with additional fictitious statements on at least two other occasions over the next six months.

 

FINRA found that Wood used the misappropriated funds for his own purposes. He later returned stolen funds to one of the customers. The other sister was reimbursed by the firm during FINRA's investigation.

 

Wood agreed to a permanent bar from the securities industry without admitting or denying the alleged misconduct, but consenting to the entry of FINRA's findings.

 

Investors can obtain more information about, and the disciplinary record of, any FINRA-registered broker or brokerage firm by using FINRA's BrokerCheck. FINRA makes BrokerCheck available at no charge. In 2008, members of the public used this service to conduct 11.6 million reviews of broker or firm records. Investors can access BrokerCheck at www.finra.org/brokercheck or by calling (800) 289-9999.

 

FINRA, the Financial Industry Regulatory Authority, is the largest independent regulator for all securities firms doing business in the United States. FINRA is dedicated to investor protection and market integrity through comprehensive regulation. FINRA touches virtually every aspect of the securities business — from registering and educating all industry participants to examining securities firms; writing and enforcing rules and the federal securities laws; informing and educating the investing public; providing trade reporting and other industry utilities; and administering the largest dispute resolution forum for investors and firms.

 

For more information, please visit our Web site at www.finra.org.