FINRA Suspends Broker for Falsifying Insurance Form
Commentary by Steven Lofchie
A broker settled FINRA charges for falsifying an insurance claim form.
According to the AWC, while registered with a member firm and working for an affiliated insurance company, a broker sold a home insurance policy that mistakenly excluded the customer's garage. FINRA said that after the garage was damaged in a fire, the broker sought to add it to the policy and submitted a claim form that falsely listed the loss date as three days later than the actual incident. FINRA said the falsification was discovered by the insurance company, which later settled with the customers.
As a result, FINRA determined that the broker violated FINRA Rule 2010 ("Standards of Commercial Honor and Principles of Trade").
To settle the charges, the broker agreed to (i) a four-month suspension from associating with any FINRA member in all capacities and (ii) a $5,000 fine.
Commentary
Interesting thing about this matter is that the broker's misconduct had nothing to do with securities.