FINRA

FINRA RULE 2010, NASD RULES 1031, 2210(D)(1)(A), 2210(D)(1)(B), 2310, 2110, 3040: RHODEN, WHILE REGISTERED WITH A MEMBER FIRM, ENTERED INTO A WRITTEN CONTRACT WITH A COMPANY TO SELL NOTE AGREEMENTS. RHODEN DID NOT PROVIDE NOTICE TO HIS FIRM, NOR DID HE RECEIVE PERMISSION FROM HIS FIRM, TO ENGAGE IN ANY ACTIVITIES RELATED TO THE COMPANY AND HE LACKED THE PROPER LICENSE, A SERIES 7, TO SELL THESE SECURITIES. RHODEN DISTRIBUTED THE COMPANY'S SALES LITERATURE AND SOLD MORE THAN $2 MILLION WORTH OF THE COMPANY'S PRODUCTS, RECEIVING COMMISSIONS EXCEEDING $230,000. RHODEN RECOMMENDED AND SOLD THE COMPANY'S PRODUCTS TO MORE CUSTOMERS, BUT THE TRANSACTIONS WERE NOT FINALIZED DUE TO DELAYS; THE STATE OF TEXAS PLACED AN INJUNCTION AGAINST THE COMPANY BEFORE THOSE SALES COULD BE COMPLETED. RHODEN NEVER RECEIVED COMMISSIONS FROM THE DELAYED TRANSACTIONS. RHODEN'S CUSTOMERS INVESTED IN THE COMPANY'S NOTE AGREEMENTS SOLELY BASED UPON RHODEN'S RECOMMENDATION. RHODEN REPRESENTED THAT THE COMPANY'S PRODUCTS WERE SAFE AND THE NOTES GUARANTEED A HIGH RETURN WITHIN FIVE YEARS. RHODEN, HOWEVER, CONDUCTED INSUFFICIENT DUE DILIGENCE AND LACKED SUFFICIENT FACTUAL BASIS TO MAKE THESE CLAIMS OR TO PROVIDE HIS CLIENTS WITH A SOUND BASIS FOR EVALUATING THE FACTS. RHODEN HAD NEVER SOLD A PROMISSORY NOTE PURPORTEDLY FUNDED BY LIFE SETTLEMENTS, YET, RHODEN RECOMMENDED THE COMPANY'S NOTE AGREEMENTS TO HIS CUSTOMERS AS A SAFE AND SUITABLE INVESTMENT. FURTHER, WHILE RECOMMENDING THE COMPANY'S INVESTMENTS TO HIS CUSTOMERS, RHODEN PROVIDED THEM WITH THE COMPANY'S SALES LITERATURE WHICH CONTAINED SEVERAL UNWARRANTED AND MISLEADING STATEMENTS, FAILED TO DISCLOSE ANY RISKS INVOLVED IN THE INVESTMENTS, AND GUARANTEED THE PRODUCTS WOULD SUCCEED. THE STATEMENTS HELPED FORM THE BASIS OF RHODEN'S RECOMMENDATIONS TO HIS CUSTOMERS, EVEN THOUGH RHODEN DID NOT VERIFY THE COMPANY'S CLAIMS PRIOR TO RECOMMENDING AND SELLING THE NOTE AGREEMENTS TO HIS CUSTOMERS. RHODEN SHOULD HAVE KNOWN THAT THESE STATEMENTS WERE MISLEADING.

Acceptance, Waiver & Consent(AWC)

Bar (Permanent)

All Capacities

Indefinite

3/12/2012

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

TEXAS

RESPONDENT'S SALE OF NLS AGREEMENTS WERE OUTSIDE THE SCOPE OF HIS REGISTRATION WITH THE SECURITIES COMMISSIONER, FAILURE TO OBTAIN PROPER APPROVAL FROM PLANMEMBER FOR SALES OF NLS AGREEMENTS, FAILURE TO COMPLETE THE OUTSIDE BUSINESS ACTIVITY REQUEST FORM TO OBTAIN APPROVAL FROM PLANMEMBER, FAILURE TO UPDATE U-4, FAILURE TO ACKNOWLEDGE SALES ON ANNUAL QUESTIONNAIRE

Order

Suspension

AGENT AND INVESTMENT ADVISER REPRESENTATIVE

5 YEARS

Undertaking

RHODEN'S AGENT AND INVESTMENT ADVISER REPRESENTATIVE REGISTRATIONS WERE SUSPENDED FOR 5 YEARS. ACCORDING TO THE UNDERTAKING, RHODEN WAS ORDERED TO PAY $25,000 TO THE RECEIVER OF NATIONAL LIFE SETTLEMENTS.