Initiated By
FINRA
Allegations
WITHOUT ADMITTING OR DENYING THE FINDINGS, MOONEY CONSENTED TO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT HIS MEMBER FIRM PROVIDED BACKDATED OUTSIDE BUSINESS ACTIVITY (OBA) FORMS TO FINRA WITHOUT INFORMING FINRA THAT THE FORMS HAD BEEN BACKDATED. THE FINDINGS STATED THAT WITH RESPECT TO EACH OBA FORM, MOONEY KNEW, OR SHOULD HAVE KNOWN, AT THE TIME THE FORMS WERE PRODUCED TO FINRA, THAT THEY HAD BEEN BACKDATED, SUCH THAT THE FORM WOULD MAKE IT APPEAR THAT MOONEY HAD REVIEWED AND APPROVED THE FORM AND SPECIFIED OUTSIDE BUSINESS ACTIVITY PRIOR TO THE DATE THAT HE ACTUALLY DID. THE FINDINGS ALSO STATED THAT THE FIRM, ACTING BY AND THROUGH MOONEY, FAILED TO ESTABLISH AND IMPLEMENT AN ADEQUATE SUPERVISORY SYSTEM FOR THE REVIEW AND RETENTION OF ELECTRONIC COMMUNICATIONS RELATING TO THE BUSINESS OF THE FIRM. THE FIRM ALSO FAILED TO RETAIN ELECTRONIC COMMUNICATIONS RELATING TO THE FIRM'S BUSINESS IN A NON-REWRITEABLE, NON-ERASABLE FORMAT. THE FIRM FAILED TO TAKE ANY STEPS TO MONITOR OR OTHERWISE ENSURE THAT REGISTERED REPRESENTATIVES WHO USED EMAIL ADDRESSES AT DOMAINS OTHER THAN THE FIRM-SPONSORED EMAIL SYSTEM FORWARDED THEIR BUSINESS-RELATED EMAILS TO THE FIRM FOR REVIEW. THE FIRM FAILED TO TAKES STEPS TO DETERMINE THAT NINE OF ITS REGISTERED REPRESENTATIVES WHO WERE USING SUCH EMAIL ADDRESSES COPIED THE FIRM'S COMPLIANCE MAILBOX ON ALL OF THEIR SECURITIES-RELATED COMMUNICATIONS. MOONEY CAUSED THE FIRM TO VIOLATE SEC RULES 17A-3 AND 17A-4. THE FINDINGS ALSO INCLUDED THAT THE FIRM'S WRITTEN SUPERVISORY PROCEDURES (WSPS) PROHIBITED REGISTERED REPRESENTATIVES FROM ENGAGING IN PRIVATE SECURITIES TRANSACTIONS UNDER ANY CIRCUMSTANCES. MOONEY KNEW THAT A REGISTERED REPRESENTATIVE WAS ENGAGING IN PRIVATE SECURITIES TRANSACTIONS FOR COMPENSATION. NOTWITHSTANDING THE PROHIBITION AGAINST PRIVATE SECURITIES IN THE FIRM'S WSPS, MOONEY FAILED TO TAKE ANY STEPS TO STOP THE REGISTERED REPRESENTATIVE'S PARTICIPATION IN THOSE TRANSACTIONS. MOONEY FAILED TO SUPERVISE THE REGISTERED REPRESENTATIVE'S PRIVATE SECURITIES TRANSACTIONS CONSISTENT WITH THE REQUIREMENTS OF NASD RULE 3040. ALTHOUGH MOONEY WAS AWARE THAT THE REGISTERED REPRESENTATIVE WAS ENGAGING IN PRIVATE SECURITIES TRANSACTIONS FOR COMPENSATION, MOONEY FAILED SUPERVISE THOSE TRANSACTIONS AS IF THEY WERE EXECUTED ON BEHALF OF THE FIRM. FINRA FOUND THAT THE FIRM FAILED TO UNDERTAKE THE REQUIRED REVIEW WITH RESPECT TO DISCLOSED OUTSIDE BUSINESS ACTIVITIES. MOONEY DID NOT CONDUCT ANY SUCH REVIEW AND APPROVED THE REGISTERED REPRESENTATIVE'S INVOLVEMENT WITH AN ENTITY AS AN OUTSIDE BUSINESS ACTIVITY. FINRA ALSO FOUND THAT THE FIRM FAILED TO EMPLOY A QUALIFIED CHIEF COMPLIANCE OFFICER (CCO). MOONEY ASSUMED THE CCO POSITION AT THE FIRM AND HELD THE CCO POSITION THROUGH APRIL 2013. MOONEY, HOWEVER, ADMITTEDLY WAS NOT QUALIFIED TO FULFILL THE DUTIES AND RESPONSIBILITIES ATTENDANT TO THE POSITION. THE FIRM AND MOONEY FAILED TO ENSURE THAT MOONEY'S OWN SECURITIES BUSINESS AS A PRODUCING MANAGER WAS REVIEWED BY A QUALIFIED PRINCIPAL OF THE FIRM. IN ADDITION, FINRA DETERMINED THAT THE FIRM, ACTING BY AND THROUGH MOONEY, FAILED TO REGISTER THE REGISTERED REPRESENTATIVE'S OFFICE AS A BRANCH OFFICE OF THE FIRM. THE FIRM, ACTING BY AND THROUGH MOONEY, FAILED TO ENSURE THAT EMPLOYEES WERE FINGERPRINTED AS REQUIRED UNDER SEC RULE 17F-2. AS A RESULT, MOONEY CAUSED THE FIRM TO VIOLATE SEC RULE 17F-2.
Resolution
Acceptance, Waiver & Consent(AWC)
Sanctions
Civil and Administrative Penalty(ies)/Fine(s)
Amount
$5,000.00
Sanctions
Suspension
Registration Capacities Affected
ANY PRINCIPAL CAPACITY
Duration
SIX MONTHS
Start Date
7/7/2014
End Date
1/6/2015
Regulator Statement
FINE PAID IN FULL ON JULY 7, 2014.