In 2008, FINRA took vigorous enforcement action against firms and brokers who harmed investors:
- Collected more than $28 million in fines from individual brokers and firms
- Ordered or secured agreements to return more than $1 billion to investors.
- Expelled or suspended 19 firms, barred 363 individuals from the industry and suspended 321 others.
- Reviewed more than 99,000 pieces of communication, resulting in 476 investigations involving nearly 2,400 separate communications.
New Jersey broker John Edward Mullins helped a long-time elderly client set up a charitable foundation to promote the musical arts—but when the client, a 97-year-old widow, was admitted to the hospital wing of the nursing home she lived in to receive round-the-clock care, Mullins began to misappropriate funds from the foundation to pay for vacations, clothing and fine wine. A FINRA hearing panel threw Mullins out of the securities business and suspended his wife, who is also a broker, for nine months.
When a 64-year-old Catholic nun inherited more than half a million dollars in investments from her mother, she turned to her mother's broker for help. As a nun, she had taken a vow of poverty and wanted the assets to go to her religious order. The broker, William Boyle, asked her to sign some checks—and then deposited those checks in his own personal accounts. Unfortunately, this wasn't the first time Mr. Boyle had defrauded a customer. It was soon revealed he had taken advantage of other elderly investors, as well. When FINRA's investigation was done, all of the investors received the full amount of their money back—and William Boyle was barred permanently from working in the securities industry.
Take the case of older workers who accepted early retirement offers at Bell South in the Carolinas, Exxon Mobil in Louisiana and at Kodak and Xerox in Rochester, NY. These investors were persuaded to cash out their pensions and retirement accounts and turn that money over to brokers who had promised impossibly high returns. Many of the retirees lost so much of their savings that they later had to return to work. As a result of FINRA's investigation and enforcement actions, three firms were ordered to pay more than $30 million in restitution to hundreds of those early retirees.
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