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WITHOUT ADMITTING OR DENYING THE FINDINGS, JOHNSON CONSENTED TO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT HE IMPROPERLY ACCEPTED A $10,000 LOAN FROM A CUSTOMER. THE FINDINGS STATED THAT THE CUSTOMER OBTAINED THE FUNDS BY TAKING A DISTRIBUTION FROM HER RETIREMENT ACCOUNT AT JOHNSON'S MEMBER FIRM. THE DISTRIBUTION RESULTED IN TAX WITHHOLDINGS OF $1,111. THE LOAN WAS NOT MEMORIALIZED IN WRITING, AND OTHER THAN JOHNSON'S PROMISE TO REPAY THE CUSTOMER A TOTAL OF $12,000 WITHIN A 12-MONTH PERIOD, THERE WERE NO SPECIFIC LOAN TERMS. OVER A 27-MONTH PERIOD, JOHNSON REPAID THE CUSTOMER A TOTAL OF $4,500. THE CUSTOMER FILED A COMPLAINT WITH THE NEBRASKA DEPARTMENT OF BANKING AND FINANCE IN CONNECTION WITH THE OUTSTANDING LOAN BALANCE. AFTER LEARNING OF THE COMPLAINT, JOHNSON REPAID THE CUSTOMER THE LOAN BALANCE OF $7,500 VIA A CASHIER'S CHECK. THE FINDINGS ALSO STATED THAT JOHNSON DID NOT NOTIFY OR RECEIVE APPROVAL FROM HIS FIRM PRIOR TO ENTERING INTO THE LOAN ARRANGEMENT. GIVEN THAT THE CUSTOMER WAS NOT A MEMBER OF JOHNSON'S IMMEDIATE FAMILY, THE FIRM'S WRITTEN POLICIES AND PROCEDURES PRECLUDED HIM FROM ACCEPTING SUCH A LOAN. JOHNSON WAS AWARE OF THE FIRM'S POLICIES AND PROCEDURES GOVERNING LOANS. IN COMPLIANCE QUESTIONNAIRES COMPLETED BY JOHNSON IN 2010 AND 2011, HE CERTIFIED THAT HE WOULD NOT BORROW MONEY FROM ANY FIRM CUSTOMER UNLESS HE RECEIVED PRIOR WRITTEN PERMISSION FROM THE FIRM AND IN THE 2011 COMPLIANCE QUESTIONNAIRE, JOHNSON FALSELY ANSWERED "NO" TO A QUESTION REGARDING OUTSTANDING LOANS WITH CLIENTS.
Resolution
Acceptance, Waiver & Consent(AWC)
Sanctions
Civil and Administrative Penalty(ies)/Fine(s)
Amount
$5,000.00
Sanctions
Suspension
Registration Capacities Affected
ANY CAPACITY
Duration
60 DAYS
Start Date
5/5/2014
End Date
7/3/2014
1/22/2014
Regulatory
Final
Initiated By
NEBRASKA
Allegations
MR. JOHNSON BORROWED MONEY FROM A CLIENT WHO WAS NOT A BROKER-DEALER, AN AFFILIATE OF THE COMPANY, OR A FINANCIAL INSTITUTION ENGAGED IN THE BUSINESS OF LENDING FUNDS OR SECURITIES.
Resolution
Consent
Sanctions
Civil and Administrative Penalty(ies)/Fine(s)
Amount
$3,500.00
Sanctions
TAKE A COURSE APPROVED BY THE NEBRASKA DEPARTMENT OF BANKING AND FINANCE ON INVESTMENT ADVISER REGULATION AND ETHICAL STANDARDS.
9/23/2013
Customer Dispute
Closed-No Action
Allegations
CUSTOMER ALLEGES THAT SHE LONAED RR $10,000 ON JUNE 17, 2011, AND THAT HE HAS FAILED TO FULLY REPAY THE FUNDS.
Disclosures can be customer complaints or arbitrations, regulatory actions, employment terminations, bankruptcy filings and certain civil or criminal proceedings that they were a part of.
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Disclosures can be customer complaints or arbitrations, regulatory actions, employment terminations, bankruptcy filings and certain civil or criminal proceedings that they were a part of.