CFP Board Imposes Public Discipline

Certified Financial Planner Board of Standards, Inc. (CFP Board) announced today public disciplinary actions against the following individuals, effective immediately or on the date noted in each case. Public disciplinary actions taken by CFP Board, in order of increasing severity, include letters of admonition, suspensions and permanent revocations.

This release contains information about disciplinary actions relating to 10 current or former CFP® professionals. Of these actions, there were 5 letters of admonition, 4 suspensions, and 1 administrative revocation.

The basis for each decision can be found in a Disciplinary Action Report below and on CFP Board’s website. The public may check on an individual’s disciplinary history and certification status with CFP Board at www.CFP.net/verify.

CFP Board’s enforcement process is a critical consumer protection. CFP® professionals agree to abide by CFP Board’s Standards of Professional Conduct (Standards), which includes the Code of Ethics and Professional Responsibility (Code of Ethics), Rules of Conduct and Financial Planning Practice Standards (Practice Standards). The Standards set forth the ethical standards for financial planners who hold the CFP® certification.

CFP Board enforces its ethical standards by investigating incidents of alleged unethical behavior by CFP® professionals. In cases where violations are found, the Disciplinary and Ethics Commission (Commission) may impose discipline ranging from a private censure or public letter of admonition to the suspension or revocation of an individual’s right to use the CFP® marks. CFP Board’s Disciplinary Rules and Procedures (Disciplinary Rules) set forth the process for investigating matters and imposing discipline where violations have been found.

The Commission meets at least three times a year to provide a fair, unbiased review of any matter in which a CFP® professional is alleged to have committed violations of the Standards. 

The Commission functions in accordance with the Disciplinary Rules and reviews all matters on a case-by-case basis, taking into account the details specific to an individual case. While CFP Board has attempted to capture the details relevant to each decision, the summary nature of these releases may omit certain details affecting the decision. Accordingly, the decisions and/or rationale described in the releases may not apply to other cases reviewed by the Commission or reflect the Commission’s future interpretation or application of the Standards.

LETTERS OF ADMONITION

CALIFORNIA

Kable M. Doria, CFP® (Roseville): In March 2018, CFP Board’s Disciplinary and Ethics Commission (Commission) and Mr. Doria entered into a settlement agreement in which Mr. Doria agreed that CFP Board would issue a Letter of Admonition. In the settlement agreement, Mr. Doria consented to CFP Board’s findings that he was a named party in a civil action involving his efforts to recruit a CFP® professional (Professional) to join Mr. Doria’s employer.  CFP Board further found that during his efforts to recruit the Professional to join his employer, Mr. Doria: (a) sought and obtained confidential client information of Professional’s firm from Professional, which he then provided to his employer; and (b) accepted a billing report from Professional that contained trade secrets from Professional’s firm.  A court found that, based on Mr. Doria’s actions, he misappropriated the trade secrets of Professional’s firm and engaged in unfair business practices against the firm.  Finally, CFP Board found that Mr. Doria made a false or misleading statement to CFP Board when he answered “no” in response to a question on his CFP Board Renewal Application that asked whether he had ever been a defendant or respondent in a civil action, including a lawsuit, arbitration or mediation.  At the time Mr. Doria completed the relevant CFP Board Renewal Application, he had been a defendant in the above-referenced civil action.  CFP Board determined that Mr. Doria’s conduct violated Rule 6.5 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Articles 3(A) and 3(G) of CFP Board’s Disciplinary Rules and Procedures.  Accordingly, the Commission admonished Mr. Doria with regard to the above-mentioned conduct. 

Iain P. Reilly, CFP® (San Diego): In May 2018, CFP Board’s Disciplinary and Ethics Commission (Commission) and Mr. Reilly entered into a settlement agreement in which Mr. Reilly agreed that CFP Board would issue a Letter of Admonition.  In the settlement agreement, Mr. Reilly consented to CFP Board’s findings that he impersonated two clients on four occasions during telephone calls with an insurance company in which he sought to obtain current information and documents on equity indexed annuities held by the clients to assist the clients with various services.  CFP Board further found that the Financial Industry Regulatory Authority, Inc. (FINRA) determined that Mr. Reilly’s conduct violated FINRA Rule 2010.  FINRA suspended Mr. Reilly from associating with any FINRA member firm in any and all capacities for 30 business days and fined him $5,000.  CFP Board determined that Mr. Reilly’s conduct violated Rules 4.3 and 6.5 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Articles 3(A) and 3(D) of CFP Board’s Disciplinary Rules and Procedures.  Accordingly, the Commission admonished Mr. Reilly with regard to the above-mentioned conduct. 

NORTH CAROLINA

Daniel C. Sigmon, CFP® (Raleigh):  In March 2018, CFP Board’s Disciplinary and Ethics Commission (Commission) and Mr. Sigmon entered into a settlement agreement in which Mr. Sigmon agreed that CFP Board would issue a Letter of Admonition. In the settlement agreement, Mr. Sigmon consented to CFP Board’s findings that during a 13-month period between June 23, 2014 and July 28, 2015, Mr. Sigmon communicated misleading information to clients or prospective clients when he represented his compensation method as “fee-only” on CFP Board’s “Find a CFP® professional” search tool.  Mr. Sigmon provided a Form ADV to his clients describing his compensation arrangement as fee and commission prior to engaging in any client relationship.  CFP Board determined the “fee-only” description was inaccurate and misleading because at the time Mr. Sigmon was: 1) licensed and appointed to sell insurance, and fully entitled to receive commissions from the sale of insurance; 2) actively receiving commission payments from his sale of annuities and insurance products; and 3) licensed by the Financial Industry Regulatory Authority, Inc., registered with an affiliated broker-dealer, and was entitled to receive brokerage commissions for the sale of securities products. CFP Board determined that Mr. Sigmon’s conduct violated Rule 2.1 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Article 3(A) of CFP Board’s Disciplinary Rules and Procedures.  Accordingly, the Commission admonished Mr. Sigmon with regard to the above-mentioned conduct.

PENNSYLVANIA

Robert S. Beck, CFP® (Philadelphia):  In September 2017, CFP Board’s Disciplinary and Ethics Commission (Commission) issued an order in which Mr. Beck received a Letter of Admonition.  The Commission issued its order after determining that Mr. Beck: 1) failed to clearly identify the assets of a client over which he was to exercise investment discretion; 2) exercised discretion in the client’s accounts on approximately 10 occasions without written discretionary authorization from the client or approval from his firm to exercise discretion; and 3) twice failed to report outside business activities and obtain his firm’s approval to engage in such activities.  The Commission also determined that the Financial Industry Regulatory Authority, Inc. (FINRA, formerly known as the National Association of Securities Dealers, Inc. or NASD) found that Mr. Beck’s conduct violated NASD Rule 2510(b) and FINRA Rule 2010.  FINRA suspended Mr. Beck from association with any FINRA member in any capacity for 15-business days and fined him $5,000.  The Commission determined that Mr. Beck’s conduct violated Rules 3.4, 4.3, and 5.1 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Articles 3(A) and 3(D) of CFP Board’s Disciplinary Rules and Procedures.  Accordingly, the Commission admonished Mr. Beck with regard to the above-mentioned conduct.   

UTAH

Arthur J. Smithee (Orem):  In March 2018, CFP Board’s Disciplinary and Ethics Commission (Commission) and Mr. Smithee entered into a settlement agreement in which Mr. Smithee agreed that CFP Board would issue a Letter of Admonition.  In the settlement agreement, Mr. Smithee consented to CFP Board’s findings that he: 1) exceeded the scope of an outside business activity approved by his firm by becoming involved in the day-to-day management of a publicly traded company when his firm had only approved the provision of consulting services; 2) engaged in two undisclosed outside business activities from 2009 to 2015; 3) participated in undisclosed private securities transactions from 2009 to 2015; and 4) proposed and facilitated the purchase by his daughter’s LLC of six million shares of common stock in a publicly traded company for $150,000 without obtaining prior approval from his firm.  CFP Board also determined that the Financial Industry Regulatory Authority, Inc. (FINRA, formerly known as the National Association of Securities Dealers, Inc. or NASD) found that Mr. Smithee’s conduct violated NASD Rules 3030 and 2110 and FINRA Rules 2010 3270.  FINRA suspended Mr. Smithee in all capacities for three months and fined Mr. Smithee $10,000.  CFP Board determined Mr. Smithee’s conduct violated Rules 4.3, 4.4, and 5.1 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Articles 3(A) and 3(D) of CFP Board’s Disciplinary Rules and Procedures. Accordingly, the Commission admonished Mr. Smithee with regard to the above-mentioned conduct. 

SUSPENSIONS

CALIFORNIA

Ryan N. Bowers (San Diego): In March 2018, CFP Board’s Disciplinary and Ethics Commission (Commission) and Mr. Bowers entered into a settlement agreement in which Mr. Bowers agreed that CFP Board would issue a two-year suspension.  In the settlement agreement, Mr. Bowers consented to CFP Board’s findings that Mr. Bowers served as the principal for Advisor Firm, which served as the investment advisor for two private funds that each owned an interest in a non-publicly traded company.  CFP Board determined that Mr. Bowers: 1) approved unreasonable assumptions that resulted in large overstatements of the value of two funds and did not reflect the current sales or exit prices of the investment in the company at the times of the valuations, which were included in the funds’ audited financial statements sent to the fund investors; 2) misrepresented the nature of the company’s relationship with a Mexican company as a partnership in the management discussion and analysis sent to fund investors, when in reality the contractual relationship between the company and the Mexican company was not a legal partnership; and 3) falsely disclosed to clients and prospective clients that the company had obtained a letter of intent from a large development bank to provide debt financing when the company had not.  CFP Board further determined that Mr. Bowers was the subject of a Cease and Desist Order with the Securities and Exchange Commission (SEC) in which the SEC determined, without Mr. Bowers admitting or denying the SEC’s findings, that Mr. Bowers’ conduct violated Section 206(2) of the Investment Advisers Act of 1940 (Advisers Act), Section 206(4) of the Advisers Act, Rules 206(4)-2 and 206(4)-7 and 206(4)-8 promulgated thereunder, and Section 207 of the Advisers Act.  Pursuant to the Cease and Desist Order, the SEC ordered that Mr. Bowers: 1) cease and desist from committing or causing any violations and any future violations of the above referenced statues and rules; 2) be barred from any association with financial industry participants, including any broker, dealer, and investment adviser, with the right to reapply for re-association after two years to the appropriate self-regulatory organization, or if there is none, to the SEC; and 3) pay a civil penalty of $50,000 to the SEC.  CFP Board also determined that the Financial Industry Regulatory Authority, Inc. (FINRA) found that Mr. Bowers’ conduct violated FINRA Rule 2010 when he failed to provide updated valuation information for the two funds to the investors’ custodian, causing inaccurate monthly account statements to be provided to investors.  FINRA suspended Mr. Bowers from association with any FINRA member firm in all capacities for five months and fined him $25,000.  CFP Board determined that Mr. Bowers’ conduct violated Rules 1.4, 2.1, 4.3, and 4.4 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Articles 3(A) and 3(D) of CFP Board’s Disciplinary Rules and Procedures.  Mr. Bowers’ suspension is effective from April 14, 2018 until April 14, 2020.

Jeffrey A. Laberge (San Diego): In March 2018, CFP Board’s Disciplinary and Ethics Commission (Commission) and Mr. Laberge entered into a settlement agreement in which Mr. Laberge agreed that CFP Board would issue a two-year suspension.  In the settlement agreement, Mr. Laberge consented to CFP Board’s findings that Mr. Laberge served as the principal for Advisor Firm, which served as the investment advisor for two private funds that each owned an interest in a non-publicly traded company.  CFP Board determined that Mr. Laberge: 1) used unreasonable assumptions that resulted in large overstatements of the value of two funds and did not reflect the current sales or exit prices of the investment in the company at the times of the valuations, which were included in the funds’ audited financial statements sent to the fund investors; 2) misrepresented the nature of the company’s relationship with a Mexican company as a partnership in the management discussion and analysis sent to fund investors, when in reality the contractual relationship between the company and the Mexican company was not a legal partnership; and 3) falsely disclosed to clients and prospective clients that the company had obtained a letter of intent from a large development bank to provide debt financing when the company had not.  CFP Board further determined that Mr. Laberge was the subject of a Cease and Desist Order with the Securities and Exchange Commission (SEC) in which the SEC determined, without Mr. Laberge admitting or denying the SEC’s findings, that Mr. Laberge’s conduct violated Section 206(2) of the Investment Advisers Act of 1940 (Advisers Act), Section 206(4) of the Advisers Act, Rules 206(4)-2 and 206(4)-7 and 206(4)-8  promulgated thereunder, and Section 207 of the Advisers Act.  Pursuant to the Cease and Desist Order, the SEC ordered that Mr. Laberge: 1) cease and desist from committing or causing any violations and any future violations of the above referenced statues and rules; 2) be barred from any association with financial industry participants, including any broker, dealer, and investment adviser, with the right to reapply for re-association after two years to the appropriate self-regulatory organization, or if there is none, to the SEC; 3) be denied the privilege of appearing or practicing before the SEC as an accountant with the opportunity to request that the SEC consider reinstatement after two years; and 4) pay a civil penalty of $50,000 to the SEC.  CFP Board determined that Mr. Laberge’s conduct violated Rules 1.4, 2.1, 4.3, and 4.4 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Articles 3(A) and 3(D) of CFP Board’s Disciplinary Rules and Procedures.  Mr. Laberge’s suspension is effective from April 14, 2018 until April 14, 2020.

Maryland

Justin K. Wine (St. Michaels): In March 2018, CFP Board’s Disciplinary and Ethics Commission (Commission) and Mr. Wine entered into a settlement agreement in which Mr. Wine agreed that CFP Board would issue a two-month suspension.  In the settlement agreement, Mr. Wine consented to CFP Board’s findings that he: 1) failed to timely amend and update his Form U4 to disclose a May 2010 short sale and a June 2011 credit compromise until August 2012; 2) introduced and recommended to five clients that they provide a short-term business loan to a business that hosts social events without providing prior and or prompt written notice to his firm; and 3) introduced and recommended an investment to three clients without providing prior written notice to his firm of his participation in the transaction.  CFP Board further determined that the Financial Industry Regulatory Authority, Inc., (FINRA) found that Mr. Wine’s conduct violated Article V, Section 2 of FINRA’s Bylaws and FINRA Rules 1122, 3270, 3040, and 2010.  FINRA suspended Mr. Wine from association with any FINRA member in any capacity for two months and fined him $12,500.  CFP Board determined that that Mr. Wine’s conduct violated Rules 4.3, 4.4 and 5.1 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Articles 3(A) and 3(D) of CFP Board’s Disciplinary Rules and Procedures. Mr. Wine’s suspension is effective from April 14, 2018 until June 14, 2018.

Pennsylvania

Akio L. Bley (Gladwyne): In March 2018, CFP Board’s Disciplinary and Ethics Commission (Commission) and Mr. Bley entered into a settlement agreement in which Mr. Bley agreed that CFP Board would issue a six-month suspension.  In the settlement agreement, Mr. Bley consented to CFP Board’s findings that he: 1) failed to provide prior written notice to his firm and failed to obtain prior written approval from his firm before participating in a private securities transaction that was outside the regular course and scope of his employment with his firm; 2) failed to disclose a misdemeanor conviction involving disorderly  conduct that was not financial-related on his application for a non-resident insurance license; 3) invested substantial sums of his own money and that of a work colleague in a questionable investment that reflected adversely on his fitness as a certificant and on the CFP® marks.  CFP Board further determined that the Financial Industry Regulatory Authority, Inc. (FINRA, formerly known as the National Association of Securities Dealers, Inc. or NASD) found that Mr. Bley’s conduct with respect to the private securities transactions violated NASD Rules 3040 and 2110.  FINRA suspended Mr. Bley from association with any FINRA member in any capacity for three months and fined him $5,000.  CFP Board determined that that Mr. Bley’s conduct violated Rules 4.3, 5.1 and 6.5 of CFP Board’s Rules of Conduct and provided grounds for discipline pursuant to Articles 3(A) and 3(D) of CFP Board’s Disciplinary Rules and Procedures. Mr. Bley’s suspension is effective from April 14, 2018 until October 14, 2018.

ADMINISTRATIVE REVOCATION

FLORIDA

William Gross (Highland Beach): In January 2018, CFP Board issued an order permanently revoking Mr. Gross’s right to use the CFP® certification marks.  This discipline followed Mr. Gross’ failure to file an answer to CFP Board’s Complaint within the required timeframe.  CFP Board’s Complaint alleged, among other things, that Mr. Gross: 1) violated Florida Statutes Section 57.07(1) when he sold securities valued at more than $3,000,000 to 55 different clients at a time when the securities were not registered for sale or exempt; 2) violated Florida Statutes Section 517.12(1) when he sold these securities at a time when he was not registered with the Florida Office of Financial Regulation (Florida OFR) as a dealer or as an associated person of a dealer; 3) communicated false and misleading information to prospective clients and clients when he claimed on his website and in an online profile that he and his firm were offering as many as 10 different types of financial services that they were not actually offering; and 4) made misleading statements to CFP Board when he asserted on his 2015 Ethics Questionnaire that he had never been a defendant or respondent in a lawsuit, and when he asserted on his 2017 Ethics Questionnaire that he had never been the subject of a governmental agency investigation.  CFP Board’s Complaint also alleged that Mr. Gross signed a settlement agreement with Florida’s insurance regulator in which he consented to pay an administrative fine of $7,500 and investigative costs of $7,500, and he agreed to refrain from selling unregistered securities.  CFP Board’s Complaint further alleged that Mr. Gross signed a separate consent agreement with Florida OFR in which he was barred from participating in a wide range of activities that were subject to regulation by Florida OFR.  CFP Board’s Complaint alleged that Mr. Gross’ conduct violated Rules 2.1 and 4.3 of CFP Board’s Rules of Conduct, providing grounds for discipline under Articles 3(A), 3(D) and 3(G) of CFP Board’s Disciplinary Rules and Procedures (Disciplinary Rules).  Mr. Gross declined to file an Answer to CFP Board’s Complaint within 20 calendar days of the date of service, as required by Article 7.3 of Disciplinary Rules.  In accordance with Article 7.4 of the Disciplinary Rules, the allegations set forth in the Complaint were deemed admitted, and CFP Board issued an Administrative Order of Revocation.  Mr. Gross’s revocation was effective as of February 15, 2018.