HORNOR, TOWNSEND, & KENT, INC

Discharged

Registered representative was terminated for failing to disclose a Consent Order he executed with the Ohio Insurance Department when he joined the member firm

FINRA

Vaughn was named a respondent in a FINRA complaint alleging that he failed to timely respond to FINRA's requests for information and documents in connection with an inquiry into a Form U5 filed by his member firm that stated he had been terminated due to outstanding tax obligations. The complaint alleges that Vaughn willfully caused the filing of false and misleading information in the disclosure reporting pages section of his Form U4 regarding the basis for his previous suspension from association with FINRA member firms. Particularly, Vaughn supplied his firm with the false and misleading information about the basis for his prior suspension, and signed the Form U4 containing the misleading information. As of the filing of this complaint, the misleading information remains in the disclosure reporting page section of Vaughn's Form U4. The complaint also alleges that Vaughn provided false and misleading information to his firm in a signed letter about the basis for his previous suspension from association with FINRA member firms. The complaint further alleges that Vaughn willfully failed to timely disclose unsatisfied Ohio state tax liens on his Form U4. An amended complaint was filed on July 12, 2016 which made the following additional allegations: Vaughn willfully failed to timely disclose that he executed a consent order with the State of Ohio Department of Insurance on his Form U4, and he failed to respond to FINRA's post-Complaint requests for information and documents.

Decision

Bar (Permanent)

All Capacities

Indefinite

2/21/2017

Monetary Penalty other than Fines

$4,137.69

The Decision includes a finding that Vaughn willfully failed to disclose a material fact on a Form U4, and that under Section 3(a)(39)(F) of the Securities Exchange Act of 1934 and Article III, Section 4 of the FINRA By-Laws, this omission make him subject to a statutory disqualification with respect to association with a member.

Hearing Panel Decision rendered January 4, 2017. The sanctions were based on findings that Vaughn willfully failed to timely amend his Form U4 to disclose tax liens and a state regulatory consent order. The findings stated that Vaughn willfully caused his Form U4 to falsely report the circumstances of a FINRA suspension and he made false and misleading statements about the suspension to his member firm. The findings also stated that Vaughn failed to provide FINRA with requested documents and information for its investigation and after this proceeding was commenced. Vaughn is subject to statutory disqualification under Section 3(a)(39)(F) of the Securities Exchange Act of 1934. The decision became final on February 21, 2017.

FINRA

RESPONDENT VAUGHN FAILED TO RESPOND TO FINRA REQUEST FOR INFORMATION.

LETTER

Suspension

ANY CAPACITY

N/A

1/13/2014

4/9/2014

PURSUANT TO FINRA RULE 9552 AND IN ACCORDANCE WITH FINRA'S NOTICE OF SUSPENSION LETTER DATED DECEMBER 18, 2013, VAUGHN IS SUSPENDED ON JANUARY 13, 2014 FROM ASSOCIATING WITH ANY FINRA MEMBER FIRM IN ANY CAPACITY. IF VAUGHN FAILS TO REQUEST TERMINATION OF THE SUSPENSION WITHIN THREE MONTHS OF THE DATE OF THE NOTICE OF INTENT, HE WILL AUTOMATICALLY BE BARRED MARCH 21, 2014 FROM ASSOCIATION WITH ANY FINRA MEMBER IN ANY CAPACITY PURSUANT TO FINRA RULE 9552(H). SUSPENSION LIFTED APRIL 9, 2014.

RESPONDENT NEVER RECEIVED THE REQUEST FOR INFORMATION WAS TEMPORARILY SUSPENDED. UPON LEARNING OF THE REQUEST FOR INFORMATION, RESPONDENT IMMEDIATELY PROVIDED THE REQUESTED INFORMATION & THE TEMPORARY SUSPENSION WAS IMMEDIATELY LIFTED ON APRIL 9, 2014.

State of Ohio Department of Insurance

As a licensed insurance agent the representative had unresolved and outstanding monetary liability and lien obligation to the State of Ohio and was in violation of Section 3905.14(B)(14)of the Ohio Revised Code.

Consent

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

$100.00