CFP Board Censures Improper CFP® Professional Conduct

Certified Financial Planner Board of Standards, Inc. (CFP Board) announced today public disciplinary actions against the following individuals’ right to use the CFP® certification marks, effective immediately or on the date noted in each case. Public disciplinary actions taken by CFP Board, in order of increasing severity, include letters of admonition, suspensions and permanent revocations.

This release contains information about disciplinary actions relating to 13 current or former CFP® professionals. Of these actions, there were 2 letters of admonition, 4 interim suspensions, 3 suspensions, 1 revocation and 3 administrative revocations.

The basis for each decision can be found in a Disciplinary Action Report below and on CFP Board’s website. The public may check on an individual’s disciplinary history and certification status with CFP Board at www.CFP.net/verify.

CFP Board’s enforcement process is a critical consumer protection. CFP® professionals agree to abide by CFP Board’s Standards of Professional Conduct (Standards), which includes the Code of Ethics and Professional Responsibility (Code of Ethics), Rules of Conduct and Financial Planning Practice Standards (Practice Standards). The Standards set forth the ethical standards for financial planners who hold the CFP® certification.

CFP Board enforces its ethical standards by investigating incidents of alleged unethical behavior by CFP® professionals. In cases where violations are found, the Disciplinary and Ethics Commission (Commission) may impose discipline ranging from a private censure or public letter of admonition to the suspension or revocation of the right to use the CFP® marks. CFP Board’s Disciplinary Rules and Procedures (Disciplinary Rules) set forth the process for investigating matters and imposing discipline where violations have been found.

The Commission meets at least three times a year to provide a fair, unbiased review of any matter in which a CFP® professional is alleged to have committed violations of the Standards.  

The Commission functions in accordance with the Disciplinary Rules and reviews all matters on a case-by-case basis, taking into account the details specific to an individual case. While CFP Board has attempted to capture the details relevant to each decision, the summary nature of these releases may omit certain details affecting the decision. Accordingly, the decisions and/or rationale described in the releases may not apply to other cases reviewed by the Commission or reflect the Commission’s future interpretation or application of the Standards.

PUBLIC LETTERS OF ADMONITION

ARIZONA

John H. Kroeger, CFP® (Phoenix): In March 2016, CFP Board’s Disciplinary and Ethics Commission (Commission) accepted an offer of settlement wherein Mr. Kroeger received a Public Letter of Admonition. In the offer of settlement, Mr. Kroeger consented to CFP Board’s findings that he entered into a Letter of Acceptance, Waiver and Consent with the Financial Industry Regulatory Authority, Inc. (FINRA), in which FINRA determined that he failed to amend his Form U4 to disclose the bankruptcy he filed in 2010.  FINRA suspended Mr. Kroeger from association with any FINRA member firm in any capacity for two months.  Mr. Kroeger failed to notify CFP Board of the FINRA suspension within 30 calendar days, in violation of Article 13.2 of the Disciplinary Rules and Procedures (Disciplinary Rules).  CFP Board determined that Mr. Kroeger’s conduct violated Rule 6.5 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Articles 3(a), 3(d) and 3(e) of CFP Board’s Disciplinary Rules. Accordingly, the Commission admonished Mr. Kroeger with regard to the above-mentioned conduct.

VIRGINIA

Franklin D. Butler, Jr., CFP® (Mechanicsville): In March 2016, CFP Board’s Disciplinary and Ethics Commission (Commission) accepted an offer of settlement wherein Mr. Butler received a Public Letter of Admonition. In the offer of settlement, Mr. Butler consented to CFP Board’s findings that he entered into a Letter of Acceptance, Waiver and Consent with the Financial Industry Regulatory Authority, Inc. (FINRA), in which FINRA determined that he instructed registered representatives to place their names as the brokers of record on variable annuity applications, even though they did not substantially participate in the sales, in order to help the representatives meet their sale quotas. FINRA suspended Mr. Butler from associating with any FINRA member in any capacity for 15 calendar days and fined him $10,000. CFP Board determined that Mr. Butler’s conduct violated Rule 4.3 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Articles 3(a) and 3(d) of CFP Board’s Disciplinary Rules and Procedures. Accordingly, the Commission admonished Mr. Butler with regard to the above-mentioned conduct.

SUSPENSIONS

FLORIDA

Lynne Marcus (Boynton Beach): In April 2016, CFP Board’s Disciplinary and Ethics Commission (Commission) accepted an offer of settlement pursuant to which it issued a six-month suspension to Ms. Marcus. In the offer of settlement, Ms. Marcus consented to CFP Board’s findings that the New York Insurance Department revoked Ms. Marcus’ insurance license because she: 1) was indebted to the New York State Department of Taxation and Finance for employer withholding tax; and 2) declared Florida as her home state with respect to her New York non-resident insurance license even though she was not then licensed as an insurance producer in Florida.  Mr. Marcus failed to notify CFP Board of the revocation of her New York Insurance License in violation of Article 13.2 of CFP Board’s Disciplinary Rules and Procedures (Disciplinary Rules).  Ms. Marcus also falsely represented on her renewal applications in: 1) 2007 and 2009 that she was not a defendant or respondent in a governmental agency proceeding or the subject of a governmental agency inquiry or investigation; and 2) 2011, 2013 and 2015 that she had not had a professional license revoked.  CFP Board determined that Ms. Marcus’s conduct violated Rule 606(a) of CFP Board’s Code of Ethics, providing grounds for discipline pursuant to Articles 3(a), 3(d), 3(e) and 3(g) of CFP Board’s Disciplinary Rules.  Ms. Marcus’ suspension is effective from April 22, 2016 until October 22, 2016.

GEORGIA

Philip D. Cox, Jr. (Atlanta): In March 2016, CFP Board’s Disciplinary and Ethics Commission (Commission) issued a 90-day suspension to Mr. Cox. The Commission issued the suspension after finding that Mr. Cox entered into a Letter of Acceptance, Waiver and Consent with the Financial Industry Regulatory Authority, Inc. (FINRA), in which FINRA determined that from May 2010 through October 2013, Mr. Cox marked order tickets for leveraged and inverse exchange funds in customer accounts as “unsolicited” when they were in fact solicited by Mr. Cox. Mr. Cox’s actions violated his firm’s procedures, which prohibited registered representatives from soliciting such funds, and caused his firm’s books to be inaccurate.  FINRA, suspended Mr. Cox for three months, ordered him to disgorge over $5,200 in commissions, and fined him $10,000.  The Commission determined that Mr. Cox’s conduct violated Rules 4.3 and 5.1 of CFP Board’s Rules of Conduct, providing grounds for discipline pursuant to Articles 3(a) and 3(d) of CFP Board’s Disciplinary Rules and Procedures. Mr. Cox’s suspension is effective from April 25, 2016 until July 24, 2016.

MICHIGAN

Shaun Dorr Hampton (Grosse Pointe): In March 2016, CFP Board’s Disciplinary and Ethics Commission (Commission) issued a six-month suspension to Mr. Hampton. The Commission issued the suspension after finding that Mr. Hampton violated his fiduciary duty to his financial planning clients when he directed two financial planning clients to sign incomplete forms and did not provide written disclosure of fees, sales charges, surrender charges and other information. The Commission determined that Mr. Hampton failed to act in the best interests of the two financial planning clients when he had them sign forms authorizing the purchase and/or liquidation of investments without providing the requisite written disclosures of fees, charges, or key features of the investments, depriving the financial planning clients of the opportunity to make informed financial decisions.  The Commission determined that Mr. Hampton’s conduct violated Rules 1.4, 2.1, 2.2(a), 2.2(e), 4.1, 4.3, 4.4 and 5.1 of CFP Board’s Rules of Conduct, providing grounds for discipline pursuant to Articles 3(a) and 3(b) of CFP Board’s Disciplinary Rules and Procedures.  Mr. Hampton’s suspension is effective from April 25, 2016 until October 25, 2016.

INTERIM SUSPENSIONS

CALIFORNIA

Eric W. Kuchel (Brea): In July 2016, CFP Board issued Mr. Kuchel an automatic interim suspension of his CFP® certification.  CFP Board issued an interim suspension after discovering that Mr. Kuchel received a Default Decision from the Financial Industry Regulatory Authority, Inc. (FINRA), barring him from associating with any FINRA member in any capacity. FINRA issued the Default Decision after Mr. Kuchel failed to appear for his on-the-record testimony in connection with FINRA’s investigation into certain mutual fund transactions, focusing on, among other things, his conduct. Pursuant to Article 5.7 of CFP Board’s Disciplinary Rules and Procedures, “[a]n interim suspension shall immediately be issued without a hearing when CFP Board Counsel receives evidence of a conviction or a professional discipline in accordance with Article 13.1 for…revocation of a financial professional license (securities, insurance, accounting or bank-related license).” Under the interim suspension order, Mr. Kuchel’s right to use the CFP® certification marks is suspended pending CFP Board’s completed investigation and possible further disciplinary proceedings. The interim suspension order became effective on July 5, 2016. 

ILLINOIS

Thomas E. Stamborski (North Barrington): In May 2016, CFP Board issued Mr. Stamborski an automatic interim suspension of his CFP® certification.  CFP Board issued an interim suspension after discovering that Mr. Stamborski entered into a Letter of Acceptance, Waiver and Consent with the Financial Industry Regulatory Authority, Inc. (FINRA), in which he consented to FINRA’s findings that in connection with an investigation into the circumstances surrounding Mr. Stamborski’s resignation from his firm, he failed to provide documents, information and testimony in violation of FINRA Rules 8210 and 2010.  Mr. Stamborski consented to a bar from associating with any FINRA member in any capacity. Pursuant to Article 5.7 of CFP Board’s Disciplinary Rules and Procedures, “[a]n interim suspension shall immediately be issued without a hearing when CFP Board Counsel receives evidence of a conviction or a professional discipline in accordance with Article 13.1 for…revocation of a financial professional license (securities, insurance, accounting or bank-related license).” Under the interim suspension order, Mr. Stamborski’s right to use the CFP® certification marks is suspended pending CFP Board’s completed investigation and possible further disciplinary proceedings. The interim suspension order became effective on May 13, 2016. 

MARYLAND

Sharon J. Fall (Chester): In May 2016, CFP Board issued Ms. Fall an automatic interim suspension of her CFP® certification.  CFP Board issued an interim suspension after discovering that Ms. Fall entered into a Letter of Acceptance, Waiver and Consent with the Financial Industry Regulatory Authority, Inc. (FINRA), in which she consented to FINRA’s findings that she refused to provide testimony to FINRA during its investigation into allegations that she borrowed money from clients.  Ms. Fall’s conduct violated FINRA Rules 8210 and 2010.  Ms. Fall consented to a permanent bar from association with FINRA members in any capacity. Pursuant to Article 5.7 of CFP Board’s Disciplinary Rules and Procedures, “[a]n interim suspension shall immediately be issued without a hearing when CFP Board Counsel receives evidence of a conviction or a professional discipline in accordance with Article 13.1 for…revocation of a financial professional license (securities, insurance, accounting or bank-related license).” Under the interim suspension order, Ms. Fall’s right to use the CFP®  certification marks is suspended pending CFP Board’s completed investigation and possible further disciplinary proceedings. The interim suspension order became effective on May 31, 2016. 

MISSOURI

Jodi Lynn Hall (Brentwood): In June 2016, CFP Board issued Ms. Hall an automatic interim suspension of her CFP® certification.  CFP Board issued an interim suspension after discovering that Ms. Hall entered into a Letter of Acceptance, Waiver and Consent with the Financial Industry Regulatory Authority, Inc. (FINRA), in which she consented to FINRA’s findings that she took approximately $75,000 in unauthorized disbursements from a business checking account of her employer.  By taking these unauthorized disbursements, Ms. Hall committed conversion in violation of FINRA Rule 2010.  Ms. Hall consented to a permanent bar from association with FINRA members in any capacity. Pursuant to Article 5.7 of CFP Board’s Disciplinary Rules and Procedures, “[a]n interim suspension shall immediately be issued without a hearing when CFP Board Counsel receives evidence of a conviction or a professional discipline in accordance with Article 13.1 for…revocation of a financial professional license (securities, insurance, accounting or bank-related license).” Under the interim suspension order, Ms. Hall’s right to use the CFP® certification marks is suspended pending CFP Board’s completed investigation and possible further disciplinary proceedings. The interim suspension order became effective on June 28, 2016. 

ADMINISTRATIVE REVOCATIONS

CALIFORNIA

Jacob Keith Cooper (San Diego): In February 2016, CFP Board issued an order permanently revoking Mr. Cooper’s right to use the CFP® certification marks. This discipline followed Mr. Cooper’s failure to file an answer to CFP Board’s Complaint within the required time period. CFP Board’s Complaint alleged that Mr. Cooper recommended to financial planning clients an unsuitable investment grade life insurance policy and unsuitable alternative investments.  CFP Board’s Complaint also alleged that the United States Securities and Exchange Commission (SEC) issued an order in which it determined that Mr. Cooper and his firm, Total Wealth Management, Inc. (TWM), breached their fiduciary duty and committed fraud by failing to disclose material information regarding TWM and Mr. Cooper’s receipt of revenue sharing from private funds for which TWM served as an investment adviser.  CFP Board’s Complaint further alleged that Mr. Cooper unsuitably invested clients’ assets into a set of private funds for which TWM served as an investment adviser.  CFP Board’s Complaint further alleged that the SEC permanently barred Mr. Cooper from association with, among other entities, investment advisors, brokers and dealers, and ordered Mr. Cooper to disgorge both $982,057.72 and $833,935.27, plus prejudgment interest, and to pay a civil monetary penalty of $780,000.  CFP Board’s Complaint alleged Mr. Cooper’s conduct violated Rules 1.4, 2.1, 2.2(b), 4.3 and 4.5 of the Rules of Conduct and Rule 703 of the Code of Ethics, providing grounds for discipline under Article 3(a) of CFP Board’s Disciplinary Rules and Procedures (Disciplinary Rules).  Mr. Cooper failed to file an Answer to CFP Board’s Complaint within 20 calendar days of the date of service, as required by Article 7.3 of CFP Board’s Disciplinary Rules. In accordance with Article 7.4 of the Disciplinary Rules, the allegations set forth in the Complaint were deemed admitted, and CFP Board issued an Administrative Order of Revocation. Mr. Cooper’s revocation was effective as of March 24, 2016.

ILLINOIS

Terence Marable (Palos Park): In February 2016, CFP Board issued an order permanently revoking Mr. Marable’s right to use the CFP® certification marks. This discipline followed Mr. Marable’s failure to file an answer to CFP Board’s Complaint within the required time period. CFP Board’s Complaint alleged that Mr. Marable entered into a Letter of Acceptance, Waiver and Consent (AWC) with Financial Industry Regulatory Authority, Inc. (FINRA), in which he consented to FINRA’s findings that he borrowed money from a client, engaged in undisclosed outside business activities and falsely attested on his firm’s annual compliance business questionnaire that he had disclosed all outside business activities and that he would abide by the firm’s policies and procedures that prohibited him from borrowing money from firm customers, in violation of FINRA Rules 3270, 3240 and 2010.  CFP Board’s Complaint further alleged that FINRA suspended Mr. Marable from association with any FINRA member in any capacity for five months.  CFP Board’s Complaint also alleged Mr. Marable failed to report FINRA’s suspension of his professional license to CFP Board within 30 days in violation of Article 13.2 of the Disciplinary Rules and Procedures (Disciplinary Rules). The Complaint alleged that Mr. Marable’s conduct violated Rules 3.6, 4.3 and 5.1 of the Rules of Conduct and provided grounds for discipline under Articles 3(a), 3(d) and 3(e) of CFP Board’s Disciplinary Rules. Mr. Marable failed to file an Answer to CFP Board’s Complaint within 20 calendar days of the date of service, as required by Article 7.3 of the Disciplinary Rules.  In accordance with Article 7.4 of the Disciplinary Rules, the allegations set forth in the Complaint were deemed admitted, and CFP Board issued an Administrative Order of Revocation. Mr. Marable’s revocation was effective as of March 24, 2016.

NEW MEXICO

Beverly Bailey (Rio Rancho): In February 2016, CFP Board issued an order permanently revoking Ms. Bailey’s right to use the CFP® certification marks. This discipline followed Ms. Bailey’s failure to file an answer to CFP Board’s Complaint within the required time period. CFP Board’s Complaint alleged, among other things, that Ms. Bailey entered into a Letter of Acceptance, Waiver and Consent with the Financial Industry Regulatory Authority, Inc. (FINRA), in which she consented to FINRA’s findings that she falsely represented herself as a client in order to help the client expedite an Individual Retirement Account rollover transfer from that financial institution to the client’s brokerage account.  CFP Board’s Complaint further alleged that FINRA suspended Ms. Bailey from association with any FINRA member in any capacity for 30 days and received a $5,000 fine.  CFP Board’s Complaint also alleged that Ms. Bailey failed to report FINRA’s suspension of her professional license to CFP Board within the required 30 calendar days in violation of Article 13.2 of the Disciplinary Rules and Procedures (Disciplinary Rules). CFP Board’s Complaint alleged that Ms. Bailey’s conduct violated Rules 4.3, 4.4 and 5.1 of the Rules of Conduct and provided grounds for discipline under Articles 3(a), 3(d) and 3(e) of CFP Board’s Disciplinary Rules.  Ms. Bailey failed to file an Answer to CFP Board’s Complaint within 20 calendar days of the date of service, as required by Article 7.3 of Disciplinary Rules.  In accordance with Article 7.4 of the Disciplinary Rules