NASD

NASD RULES 2110 AND 8210 - RESPONDENT FAILED TO RESPOND TO NASD REQUESTS FOR INFORMATION.

Acceptance, Waiver & Consent(AWC)

Bar

WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, SCHWENDINGER CONSENTED TO THE DESCRIBED SANCTION AND TO THE ENTRY OF FINDINGS, THEREFORE HE IS BARRED FROM ASSOCIATION WITH ANY NASD MEMBER IN ANY CAPACITY.

THE CLIENT STATES HE NEITHER ENDORSED NOR AUTHORIZED THE LEVEL OF ACIVITY THAT OCCURRED IN HIS ACCOUNT. THE CLIENT ALSO STATES HE HAS NOT BEEN RECEIVING CONFIRMATIONS ON THE SALE OF STOCKS. THE CLIENT REQUESTS A SUMMARY OF TRANSACTIONS FOR THE PAST 24 MONTHS AND REQUEST THAT NO FURTHER TRANSACTIONS TAKE PLACE WITHOUT HIS APPROVAL. IT APPEARS LOSSES EXCEED $5,000.****************************** 5/14/02 ARBITRATION DESCRIPTION: ALLEGATIONS OF UNAUTHORIZED TRADING, CHURNING, BREACH OF FIDUCIARY DUTY, VIOLA TION OF NASD RULES AND REGULATIONS, FRAUD, MISREPRESENTATION, NEGLIGENCE AND VIOLATION OF MISSOURI SECURITIES LAWS IN THE TRADING OF SECURITIES IN THEIR ACCOUNT THAT RESULTED IN DAMAGES OF $122,931 CONSISTING OF $54,653 OF UNAUTHORIZED TRADES, $4,419 MARGIN INTEREST AND $53,859 IN EXCESSIVE COMMISSIONS. (AMOUNT CLAIMED: $122,931 PLUS 8% INTEREST, ATTORNEYS' FEES, RESCISSION AND $375,000 IN PUNITIVE DAMAGES.)

$5,000.00

$100,000.00

THE CLIENT WAS USING THE ACCOUNT FOR AGGRESSIVE INVESTING AS IT REPRESENTS A SMALL PORTION OF HIS NET WORTH. MR. SCHWENDINGER HAS STATED THAT MOST OF THE TRANSACTIONS WERE IPOS OR SECONDARY OFFERINGS WHICH THE CLIENT DECIDED ON WITH LITTLE INPUT FROM MR. SCHWENDINGER. IT IS BELIEVED THE CLIENT RECEIVED MONTHLY ACCOUNT STATEMENTS AND CUSTOMER CONFIRMS THROUGHOUT THE YEARS 2000 AND 2001. THE CLIENT HAS APPARENTLY ACCEPTED THIS TRADING ACTIVITY OVER THE YEARS. CLAIM DENIED. 5/28/02: ARBITRATION FILED WITH ALLEGATIONS OF UNAUTHORIZED TRADING, CHURNING, BREACH OF FIDUCIARY DUTY, VIOLATION OF NASD RULES AND REGULATIONS, FRAUD, MISREPRESENTATION, NEGLIGENCE AND VIOLATION OF MISSOURI SECURITIES LAWS IN THE TRADING OF SECURITIES IN THEIR ACCOUNT THAT RESULTED IN DAMAGES OF $122,931 CONSISTING OF $54,653 OF UNAUTHORIZED TRADES, $4,419 MARGIN INTEREST AND $53,859 IN EXCESSIVE COMMISSIONS. (AMOUNT CLAIMED: $122,931 PLUS 8% INTEREST, ATTORNEYS FEES, RESCISSION AND $375,000 IN PUNITIVE DAMAGES.)

A SECOND ARBITRATION WAS FILED BY THE ABOVE INDIVIDUALS WITH ALLEGATIONS OF UNAUTHORIZED AND UNDISCLOSED TRADES; FAILURE TO DISCLOSE MATERIAL INFORMATION REGARDING COSTS OF MUTUAL FUND PURCHASES, UNSUITABLE RECOMMENDATIONS, BREACH OF FIDUCIARY DUTY, VIOLATIONS OF MISSOURI SECURITIES ACT, AND FAILURE TO SUPERVISE. (AMOUNT CLAIMED: PLAINTIFF #1 SEEKS $75,000 ACTUAL AND $250,000 PUNITIVE FROM EACH RESPONDENT, PLAINTIFFS #2 AND #3 SEEK $50,000 ACTUAL AND $250,000 PUNITIVE FROM EACH RESPONDENT, AND PLAINTIFF #4 SEEKS $25,000 AND $100,00 PUNITIVE FROM EACH RESPONDENT.)

$150,000.00

$2,700.00

THE CLIENT IS ALLEGING THE INVESTMENT REPRESENTATIVE MADE AN UNAUTHORIZED TRADE IN HER ACCOUNT. (AMOUNT CLAIMED: $830.00.)

$820.00

$805.53

AWARD OF $835.53 Not Provided