Broker Barred by FINRA in a Default Decision after Converting $200,000 of Customer Investment Funds to Purchase New HomeTuesday, March 24, 2020
On March 6, 2020, the Financial Industry Regulatory Authority (FINRA) Office of Hearing Officers released a Default Decision barring registered representative Erik Pica for violating numerous securities industry laws, including those involving converting and misusing customer funds and falsely testifying during on-the-record testimony.
Erik Pica has been associated with five New York City-based FINRA member firms since obtaining his securities license including:
- Eastbrook Capital Group LLC from October 2004 to October 2008. This firm was expelled by FINRA in September 2009.
- Chicago Investment Group, LLC from September 2008 to August 2009. FINRA expelled this firm in September 2010.
- First Midwest Securities, Inc. from August 2009 to February 2012.
- Global Arena Capital Corp from January 2012 to April 2015. FINRA expelled this firm in January 2016.
- Joseph Stone Capital LLC (JSCL) from April 2015 to November 2019.
According to his FINRA BrokerCheck report, JSCL terminated Pica after FINRA brought forth allegations that Pica was providing inaccurate information to JSCL and FINRA staff concerning the disposition of customer funds and providing misleading testimony to FINRA during on-the-record interview in violation of FINRA Rules 8210 and 2010.
FINRA’s complaint filed on October 25, 2019 includes seven causes of action against Pica. First, FINRA claimed that in February 2019, Pica converted $200,000 from a 76-year old retired customer by depositing funds intended for investment in a JSCL IRA account into his personal bank account. Pica allegedly instructed the customer to write a check for $200,000 from his personal bank account to a bank account for Light Capital Group, a company which Pica controlled. By this same conduct, the second cause of action brought forth by FINRA is that Pica misused customer funds.
The remaining five causes of action alleged that Pica took numerous actions in an attempt to conceal his conversion and misuse of customer funds. These actions include providing false and misleading information to both his customer and JSCL and to FINRA staff during an onsite examination of JSCL’s branch office. Pica stated to FINRA staff that he had not entered JSCL’s office or his personal office one evening while FINRA staff was not present. Pica then went on to provide false and misleading on-the-record testimony and failed to provide FINRA staff with documents and information sought in two FINRA Rule 8210 requests. Specifically, Pica failed to produce the mortgage application Pica submitted to a mortgage company in connection with a home he and his spouse purchased using the customer’s $200,000.
For violating these FINRA rules, Pica is barred from associating with any FINRA member firm in any capacity and ordered to pay back the $200,000 he took.
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