3 brokers in hot water over sketchy Covid-19 loan applications



Last month, Finra fined three brokers with large firms for mishandling or inappropriate federal loan programs for small businesses under economic pressure from the Covid-19 pandemic.

Financial Industry Regulatory Authority Inc. reported in January InvestmentsNews this is probing registered representatives who received coronavirus loans for possible disruptions related to work they do outside of their brokerage firms.

Finra’s efforts seem to have intensified lately; the three brokers, Gloria Willis, Evelyn Batista and Kenrick Sexton, are no longer registered sellers and have been suspended or excluded from the securities industry.

As is the case with these calculations, none of the three former brokers in question acknowledged or denied the findings of the investigations in the settlement process. And no one was contacted Monday for comment.

But according to Finra documents and broker profiles on BrokerCheck, every violation of industry rules was associated to applications for government loans from the small business administration.

Willis, a broker at JP Morgan Securities from 2014 to last December, was barred from participation in the securities industry under a Finra agreement for refusing to testify in Finra’s investigation into her departure from the firm. According to Finra, JP Morgan Securities reviewed Willis “to assess whether she has a compelling and appropriate reason for receiving … a grant from the Small Business Administration.”

Batista, who had been a broker at Merrill Lynch for less than a year, was suspended by Finroy last Thursday for seven months when it was revealed that “she had recklessly misrepresented her loan application and loan agreement she filed with the Small Business Administration. to get a loan in the event of a disaster caused by economic damage, ”said Finra.

“In the statement, Batista recklessly falsely stated that she was the owner of a real estate business, that the business made $ 35,000 and that the business lost $ 15,000 in rental income due to the pandemic,” Finra said. “Batista did not disclose external business activities with his member firm, did not own any such real estate management business, and did not have any other business eligible for this type of loan from the SBA.”

Sexton, a former Wells Fargo broker, was suspended for a month and fined $ 2,500 on July 21.

“Sexton did not operate a business eligible for a small business loan from the SBA,” Finra said. “Instead, Sexton was looking for a loan to fund his online merchant account.”

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