Texas Broker Consents to FINRA Sanctions to Resolve Allegations of Making Unsuitable Recommendations of High-Risk Energy Sector Securities to CustomersWednesday, July 10, 2019
On June 20, 2019, the Financial Industry Regulatory Authority (FINRA) Department of Enforcement approved a Letter of Acceptance, Waiver and Consent (AWC) submitted by former general securities representative Michael Kamperman to resolve allegations of violating securities industry rules.
According to his FINRA BrokerCheck report, Kamperman has been associated with two FINRA member firms within the past ten years: Prospera Financial Services, Inc. in McGregor, Texas from January 2005 to December 2014 and HD Vest Investment Services in Waco, Texas from December 2014 to June 2017. He is not currently associated with any FINRA member firm.
FINRA Department of Enforcement alleges in the AWC that from May 2010 to June 2016, Kamperman made unsuitable recommendations in eight customers’ retirement accounts by over concentrating the accounts in the oil and gas energy sector, which are generally known to be high-risk, speculative securities. FINRA further alleges that he recommended one customer hold a leveraged inverse exchange-traded note (ETN) in his 401(k) retirements account for over a year. ETNs are designed to be held for only one trading day, making this recommendation unsuitable for any customer in any consideration. The AWC states that as a result of his unsuitable recommendations, Kamperman’s customers suffered over $407,000 in trading losses. Based on the foregoing, Kamperman violated NASD Rule 2310 and FINRA Rules 2111(a) and 2010.
Without admitting or denying the allegations made against him by FINRA, Kamperman consented to a $20,000 fine and a suspension from associating with all FINRA member firms in any capacity for 18 months.
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