51-Year Industry Vet Dinged for Receiving $477k Gift from Elderly Client
The Financial Industry Regulatory Authority imposed a six-month suspension and $10,000 fine on a 51-year industry veteran who had been with Raymond James Financial Services and received unapproved cash gifts from an elderly, widowed client.
Jerry Rice, who had been based in Tinton Falls, New Jersey before leaving Raymond James’ independent broker unit in 2019 while under review, failed to disclose that he “received $477,000 in monetary gifts from a senior customer” between 2013 and 2019, according to the September 17-finalized Finra action. He had also been named as a beneficiary in the customer’s will without approval, the regulator said.
He broke Raymond James’ rules prohibiting brokers from receiving gifts from customers or being named beneficiaries in their wills without the firm’s prior authorization and thus violated the regulator’s ‘catch-all’ Rule 2010, Finra said.
Rice, who has not registered with another brokerage or advisory firm since his exit from Raymond James, signed the letter of acceptance, waiver and consent without admitting or denying the Finra findings. He could not immediately be reached for comment.
Finra said it launched its investigation after being contacted by the customer’s attorney.
Rice had received the gifts at issue beginning in 2013, from a then 89-year-old widow, according to the Finra letter. He was also written into the will that same year.
Still, Rice had confirmed in annual compliance questionnaires that he understood reps were not permitted to receive gifts in excess of $100 per person, per year, without written pre-approval from the firm. He also attested in the annual questionnaires that he had not been named a beneficiary of a non-relative customer’s estate.
Of the nearly half a million dollars in gifts sent Rice’s way, “some” went to his “immediate family members,” according to the Finra letter.
Rice began his career at Merrill Lynch in 1968, moved to Smith Barney in 1990 by way of its Lehman Brothers predecessor and also worked at Robert Thomas Securities from 1995 to 1999 before joining Raymond James, according to his BrokerCheck record.
In a similar case, Finra in June levied a one-year suspension and $10,000 fine on a 26-year industry veteran in Maryland over his status as executor and beneficiary of a late client’s estate, which he had not disclosed to RBC Wealth Management-U.S. or UBS Wealth Management USA, his employers during the relevant period. He had stood to inherit $4 million from his late client.