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Regulation and Compliance > Federal Regulation > FINRA

Another Broker Impersonated Clients … 6 of Them. FINRA Wasn't Pleased.

By Jeff Berman

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A broker allegedly impersonated six of his clients during 16 recorded telephone calls to the insurance firm Nationwide to request redemptions of funds, and things predictably went badly from there for him, according to a Financial Industry Regulatory Authority letter of acceptance, waiver and consent he signed Nov. 21.

Without admitting or denying the findings, Andrew Fairchild agreed to a two-month suspension from association with any FINRA member and a $7,500 fine. FINRA accepted the letter Thursday.

The case is very similar to a recent one in which an ex-Royal Alliance Associates broker allegedly impersonated one of his clients during two telephone calls with the customer service hotline of an annuity company. Ex-Royal rep Harold A. Schwartz wound up being “permitted to resign” from Advisor Group’s Royal Alliance wealth management firm, according to a Form U5 filed Feb. 22.

The incidents involving Fairchild happened while he was associated with Investacorp from August 2014 through December 2018, according to the FINRA letter. He was registered as a general securities representative at that firm and worked at a non-registered location in Parkland, Florida, the letter said.

A Form U5 filed by Investacorp disclosed that Fairchild was permitted to resign after it learned of the “representations” Fairchild made to Nationwide “in an effort to fulfill customer directed administrative requests,” according to the FINRA letter.

“All six customers authorized the transactions, and Nationwide properly processed the redemptions and distributed the funds directly to the customers,” the letter said. But in impersonating the clients, Fairchild violated FINRA Rule 2010 that requires associated reps to “observe high standards of commercial honor and just and equitable principles of trade,” according to FINRA.

Not clear was whether the customers had authorized Fairchild to impersonate them. Investacorp didn’t immediately respond to a request for comment. Fairchild’s attorney, Gregg Breitbart of the law firm Kaufman Dolowich & Voluck in Fort Lauderdale, Florida, said “Andrew is pleased to have this issue behind him and looks forward to continuing to serve his clients.”

Fairchild is currently registered with FINRA through his association with Newbridge Securities in Boca Raton, Florida. He joined that firm this year, after a brief stint at Kovack Securities after leaving Investacorp, according to his profile at FINRA’s BrokerCheck website.

There are three disclosures included in his BrokerCheck profile. In addition to the employment separation from Investacorp, dated Dec. 6, 2018, there’s also a financial disclosure in which he was permitted to short-sell a home, along with a customer dispute denied in 2009, BrokerCheck shows. His 30-year career also included stints with six other firms, starting with First Investors Corp. in 1989.

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Jeff Berman

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