CFP Board Censures Improper CFP® Professional Conduct

WASHINGTON, Oct. 20, 2016 /PRNewswire-USNewswire/ -- Certified Financial Planner Board of Standards, Inc. (CFP Board) announced today public disciplinary actions against the following individuals' right to use the CFP® certification marks, 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 eight CFP® professionals. Of these actions, there were three letters of admonition, two suspensions and three administrative revocations.

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 the 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 actions in this release result from final decisions of the Commission.  

The Commission meets 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

ARIZONA

Frank A. Molinar, CFP® (Scottsdale): In August 2016, CFP Board's Disciplinary and Ethics Commission (Commission) accepted an offer of settlement wherein Mr. Molinar received a Public Letter of Admonition. In the offer of settlement, Mr. Molinar consented to CFP Board's findings that he filed for Chapter 7 Bankruptcy in 1990 and Chapter 13 Bankruptcy in 1991 and in 2015, which reflects adversely on Mr. Molinar's integrity and fitness as a certificant, upon the CFP® marks, and upon the profession. CFP Board determined that Mr. Molinar's conduct violated Rule 6.5 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. Molinar with regard to the above-mentioned conduct.

OHIO

Charles Zsarnay, CFP® (Toledo): In July 2016, CFP Board's Disciplinary and Ethics Commission (Commission) accepted an offer of settlement wherein Mr. Zsarnay received a Public Letter of Admonition. In the offer of settlement, Mr. Zsarnay consented to CFP Board's findings that he engaged in conduct that reflects adversely on his integrity and fitness as a certificant, on the CFP® marks, and on the profession when: 1) he copied drivers licenses of "extraordinary persons" in violation of Ohio law and which resulted in a misdemeanor conviction that has been expunged; 2) he failed to promptly disclose to Firm A that he had been charged with a felony, which resulted in his termination by Firm A; 3) he failed to amend his Form U4 to disclose his criminal conviction; 4) he testified falsely to the Ohio Securities Division regarding his role in copying drivers licenses of "extraordinary persons", which resulted in the Ohio Securities Division concluding Mr. Zsarnay was not of "good business repute" and denying his Ohio securities salesperson license and investment adviser representative license applications (Ohio Denial), 5) Firm B terminated him from employment due to the Ohio Denial.  CFP Board also found that Mr. Zsarnay failed to disclose to CFP Board: 1) his criminal conviction, the Ohio Denial and the related investigation on his 2010, 2012 and 2014 CFP Board Renewal Applications; and 2) his Firm A and Firm B terminations, and investigations by the Financial Industry Regulatory Authority, Inc. and the Ohio Department of Insurance on his 2012 and 2014 CFP Board Renewal Applications. CFP Board determined that Mr. Zsarnay's conduct violated Rules 6.2 and 6.5 of CFP Board's Rules of Conduct and provided grounds for discipline pursuant to Articles 3(a) and 3(e) of CFP Board's Disciplinary Rules and Procedures. Accordingly, the Commission admonished Mr. Zsarnay with regard to the above-mentioned conduct.

OREGON

Michael Joseph Eugenio, CFP® (Lake Oswego): In August 2016, CFP Board's Disciplinary and Ethics Commission (Commission) accepted an offer of settlement pursuant to which it issued Mr. Eugenio a Public Letter of Admonition and required him to complete four credit hours of remedial education in Ethics.  In the offer of settlement, Mr. Eugenio consented to CFP Board's findings that he entered into a settlement with the Oregon Department of Consumer and Business Services Division of Finance and Corporate Securities in which Mr. Eugenio consented to, without admitting or denying, Oregon's findings that he charged one or more clients an unreasonably high advisory fee based on an inflated value of rare coins held in clients' accounts. The Oregon Settlement ordered Mr. Eugenio to cease and desist from charging unreasonable advisory fees, violating any provision of the Oregon Securities Laws, and to pay a Civil Penalty of $2,500. CFP Board determined that Mr. Eugenio's conduct violated Rules 1.4, 4.1 and 4.3 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. Eugenio with regard to the above-mentioned conduct.

SUSPENSIONS

ILLINOIS

Gregory H. Bray (Alton): In September 2016, CFP Board's Disciplinary and Ethics Commission (Commission) accepted an offer of settlement pursuant to which it issued a one-year and one-day suspension to Mr. Bray. In the offer of settlement, Mr. Bray consented to CFP Board's findings that he entered into a letter of Acceptance, Waiver and Consent (AWC) with the Financial Industry Regulatory Authority, Inc. (FINRA), in which FINRA determined that he failed to adequately supervise the sales of complex products and Class A shares of leveraged/inverse mutual funds.  FINRA suspended Mr. Bray from associating with any FINRA member in a principal capacity for six weeks and fined him $7,500.  CFP Board also found that Mr. Bray executed 11 transactions on behalf of a New Hampshire client without being licensed in New Hampshire to do so.  The State of New Hampshire ordered Mr. Bray and two entities to cease and desist from any future violations and ordered them to pay fines and costs totaling $12,000.  CFP Board further determined that Mr. Bray failed to properly disclose the FINRA suspension and the New Hampshire action to CFP Board.  CFP Board determined that Mr. Bray's conduct violated Rules 4.3 and 4.6 of CFP Board's Rules of Conduct, providing grounds for discipline pursuant to Articles 3(a), 3(d), 3(g) and 3(e) of CFP Board's Disciplinary Rules and Procedures.  Mr. Bray's suspension is effective from September 21, 2016 until September 22, 2017.

KANSAS

Timothy R. Rodgers (Overland Park): In July 2016, CFP Board's Disciplinary and Ethics Commission (Commission) accepted an offer of settlement pursuant to which it issued a five-month suspension to Mr. Rodgers. In the offer of settlement, Mr. Rodgers consented to CFP Board's findings that he entered into a letter of Acceptance, Waiver and Consent (AWC) with the Financial Industry Regulatory Authority, Inc. (FINRA) in which FINRA determined Mr. Rodgers participated in two unapproved securities transactions and made false statements in annual compliance questionnaires relating to the securities transactions.  FINRA suspended Mr. Rodgers from association with any FINRA member in any capacity for five months and fined him $10,000. CFP Board determined that Mr. Rodgers' conduct violated Rules 4.3 and 5.1 of CFP Board's Rules of Conduct, providing grounds for discipline pursuant to Articles 3(a) and 3(d) of CFP Board's Disciplinary Rules and Procedures.  Mr. Rodgers' suspension is effective from July 26, 2016 until December 26, 2016.

ADMINISTRATIVE REVOCATIONS

MARYLAND

William W. Gammon (Towson): In June 2016, CFP Board issued an order permanently revoking Mr. Gammon's right to use the CFP® certification marks. This discipline followed Mr. Gammon's failure to file an answer to CFP Board's Complaint within the required time period. CFP Board's Complaint alleged that Mr. Gammon, while in a financial planning relationship, recommended and sold clients alternative investments, including non-traded REITs, TICs, debentures, and equipment leasing funds, that were unsuitable given the clients' ages, risk tolerances and investment objectives because the investments unsuitably concentrated the clients' assets in alternative and real estate investments and the investments did not meet the clients' liquidity restrictions.  The Complaint alleged that Mr. Gammon's conduct violated Rules 201, 202, 607 and 703 of CFP Board's Code of Ethics and Professional Responsibility and Financial Planning Practice Standards 300-1, 400-1, 400-2, 400-3 and 500-2, which provided grounds for discipline under Articles 3(a) and 3(b) of CFP Board's Disciplinary Rules and Procedures (Disciplinary Rules). Mr. Gammon failed 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 the 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. The administrative revocation of Mr. Gammon's right to use the CFP® marks became effective on July 2, 2016.

MASSACHUSETTS

Lee D. Weiss (Boston): In May 2016, CFP Board issued an order permanently revoking Mr. Weiss's right to use the CFP® certification marks. This discipline followed Mr. Weiss's failure to file an answer to CFP Board's Complaint within the required time period. CFP Board's Complaint alleged, among other things, that Mr. Weiss: 1) recommended and sold investments to his clients that did not pass a reasonable basis suitability test and were not suitable for any investor; 2) recommended and sold alternative investments and private loans to the clients that unsuitably concentrated the clients' accounts in those investments; 3) failed to disclose his direct and indirect interests in the investments that he recommended to his clients; and 4) overcharged the clients for advisory fees. Mr. Weiss also failed to provide to CFP Board information it requested, and therefore CFP Board sought to draw an adverse inference against Mr. Weiss with respect to the issues raised in CFP Board's Complaint.  CFP Board's Complaint alleged that Mr. Weiss's conduct violated Rules 1.4, 2.1, 4.1, 4.3, 4.4, 4.5 and 6.1 of the Rules of Conduct and provided grounds for discipline under Articles 3(a) and 3(f) of CFP Board's Disciplinary Rules and Procedures (Disciplinary Rules).  Mr. Weiss failed 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. The administrative revocation of Mr. Weiss's right to use the CFP® marks became effective on June 30, 2016.

OHIO

Carolyn C. Kaufman (Hudson): In June 2016, CFP Board issued an order permanently revoking Ms. Kaufman's right to use the CFP® certification marks. This discipline followed Ms. Kaufman's failure to file an answer to CFP Board's Complaint within the required time period. CFP Board's Complaint alleged that Ms. Kaufman received a permanent bar from the Financial Industry Regulatory Authority, Inc. for being convicted of Conspiracy to Obstruct Justice, Obstruction of Justice and Perjury in the US District Court for the Southern District of New York relating to her false testimony regarding the forgery of an investment advisory contract. CFP Board's Complaint alleged Ms. Kaufman's conduct violated Rule 6.5 of the Rules of Conduct, providing grounds for discipline under Articles 3(a), 3(c) and 3(d) of CFP Board's Disciplinary Rules and Procedures (Disciplinary Rules). Ms. Kaufman failed 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 CFP Board's 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. The administrative revocation of Ms. Kaufman's right to use the CFP® marks became effective on July 6, 2016.

ABOUT CFP BOARD

The mission of Certified Financial Planner Board of Standards, Inc. is to benefit the public by granting the CFP^® certification and upholding it as the recognized standard of excellence for competent and ethical personal financial planning. The Board of Directors, in furthering CFP Board's mission, acts on behalf of the public, CFP® professionals and other stakeholders. CFP Board owns the certification marks CFP®, Certified Financial Planner™, CFP^® (with plaque design) and CFP^® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.  CFP Board currently authorizes more than 75,000 individuals to use these marks in the U.S.

SOURCE Certified Financial Planner Board of Standards, Inc.

Related Links

http://www.cfp.net