The Financial Industry Regulatory Authority is barring a former Citigroup broker from membership. The sanction comes following allegations of Texas securities fraud. According to the findings, Jose Luis Vinas converted about $3.3 million from customers while he served as a registered representative for both UBS Securities and Citigroup. The clients were primarily located in Mexico and many of them do not speak English. Vinas, who is from Houston, had also worked for Bancomer Securities International.
FINRA says that Vinas had these non-English speaking customers sign blank documents that were in English. A variable credit line account was set up at his firm in their names. He then would allegedly turn in or cause to be submitted applications from these clients asking for credit line increases even though they had never asked for credit accounts or knew they existed.
The SRO is also accusing Vinas of forging or causing the forgery of client signatures on Letters of Authorization (LOAs) . He even allegedly had customers sign ones to authorize the transfer of customer funds without their knowledge or authorization. FINRA says that Vinas submitted or caused to be turned in to another member firm, verbal LOAs that were fraudulent and again turned in without client knowledge or authorization. These verbal LOAs gave him permission to wire money to their accounts. He allegedly gave false documents showing bogus balances in accounts that he had already taken the money from and closed.
Texas Securities Fraud
For a broker to steal money from an investor without authorization or conduct transactions without their authorization is Texas securities fraud. Not only could the broker be subject to criminal charges but he/she will likely be subjected to fines or sanctions. Other examples of broker misconduct that could be grounds for a Houston securities fraud case include unsuitability, omissions and misrepresentations, churning, overconcentration, failure to execute trades, breach of promise, breach of contract, failure to supervise, breach of fiduciary duty, margin account abuse, unauthorized trading, margin account abuse, and negligence.
It is also important that brokers understand the risks involved when making an investment and have an understanding of what type of arrangements they are signing up for when working with a broker-dealer. Unfortunately, there are brokers out there who do give the rest of the industry a bad name in their efforts to make a profit while disregarding their clients’ best interests. Many investors have sustained financial losses as a result.
Our Houston securities fraud law firm represents investors statewide and nationally. We also have stockbroker fraud victims located abroad. We are committed to helping our clients get their money back and we have worked on thousands of cases that have ended with successful outcomes.
FINRA Case #2009017198901, FINRA: Disciplinary and Other FINRA Actions
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