Kentucky Department of Insurance

THE KENTUCKY DEPARTMENT OF INSURANCE TERMINATED MR. DONAHUE'S NON-RESIDENT INSURANCE LICENSE BASED ON VIOLATIONS OF KRS 304.9-140(7) WHICH REQUIRES INSURANCE LICESEES TO MAINTAIN THE APPLICABLE LICENSE IN HIS OR HER HOME STATE IN ORDER TO GOLD A KENTUCKY NON-RESIDENTIAL LICENSE.

TERMINATION

TERMINATION

FLORIDA STATE INSURANCE COMMISSION - DICISION OF INSURANCE AGENT & AGENCY SERVICES

REPRESENTATIVE'S LICENSES AND ELIGIBILITY FOR LICENSURE AND APPOINTMENTS WAS SUSPENDED FOR A PERIOD OF THREE (3) MONTHS PURSUANT TO SECTION 626.641(1), FLORIDA STATUTES BASED ON FINRA's August 10. 2022 ACTION TAKEN AGAINST THE REPRESENTATIVE

Order

Suspension

Florida Life Insurance License and Eligibility

3 MONTHS

2/10/2023

5/10/2023

FINRA

Without admitting or denying the findings, Donahue consented to the sanctions and to the entry of findings that he recommended that two customers invest an unsuitably high percentage of their account into a single energy-sector security. The findings stated that Donahue recommended that the customers invest 90 percent of their investments at his member firm into a single, non-diversified mutual fund. That recommendation was not consistent with the customers' investment profiles because the fund in question invested substantially all of its assets in companies in the energy sector and Donahue's recommendation therefore subjected the customers to substantial risk of loss. Four years after Donahue's initial recommendation, the mutual fund's value decreased by more than 50 percent. After transferring their accounts to a different broker-dealer, the customers sold their investments in the fund in question and realized a substantial loss.

Acceptance, Waiver & Consent(AWC)

Civil and Administrative Penalty(ies)/Fine(s)

$2,500.00

Suspension

All Capacities

30 Days

9/6/2022

10/5/2022

Undertaking

Donahue will attend and satisfactorily complete 10 hours of continuing education concerning FINRA's suitability rule. Restitution is not ordered against Donahue because the customers have settled an arbitration pertaining to his unsuitable recommendation.

THE STATEMENT OF CLAIM ALLEGES BREACH OF FIDUCIARY DUTY, GROSS NEGLIGENCE, AND OTHER VIOLATIONS IN CONNECTION WITH MY RECOMMENDATION TO TRANSFER CERTAIN MUTUAL FUND SHARES IN 2016.

$131,884.20

$25,000.00