Finra Sanctions Broker Who Traded in Dead Customer’s Account
The Financial Industry Regulatory Authority has fined and suspended a broker for trading in a customer’s non-discretionary account for five-and-a-half years without her written permission, but his most egregious error may have been his failure to realize that she had been dead for two of those years.
Erhart Del Campo, who accepted the sanctions without admitting or denying the findings, traded from the customer’s account opening in 2013 to her death in June 2017 “based on annual or semi-annual discussions” with her regarding trading strategy, Finra said. The trades violated Northeast Securities prohibition of discretionary trading without written permission from customers, and Erhart Del Campo falsely replied on a firm questionnaire that he had not serviced any accounts on a discretionary basis.
He crossed the line into “unauthorized trading” when he made 77 trades involving $500,000 worth of securities after her demise, Finra said.
“Unaware that she had died, Erhart Del Campo continued to trade in her account for over two years without authorization,” the consent letter said. “He believed that he was trading based on a trading strategy agreed to by the customer prior to her death.”
Erhart Del Campo, who started his career at Northeast Securities in 2012 and worked for a month in Florida at Epic Capital Securities after Insigneo fired him in September 2019, could not be reached for comment. He has not been registered with Finra since leaving Epic in October 2019, according to BrokerCheck.
Finra began investigating Erhart Del Campo after Insigneo filed a U5 termination form saying he “failed to follow firm procedures with regards to placing trades.”
As is typical with Finra sanctions, the fine and restitution are due only if Erhart Del Campo reassociates with a Finra member firm or seeks relief from any statutory disqualification resulting from the unauthorized trading event or any other proceeding, the consent letter said.