Pederson, PC is investigating the actions of V. Cullen Kempson III currently of American Portfolios and previously of Commonwealth Financial Network. Kempson has previously settled charges of unauthorized trading in the account of a deceased investor and is currently facing felony weapons charges. To speak to an attorney for a free and confidential consultation please call 1-866-817-0201.
A recent settlement agreement Kempson enter into with FINRA regulators agrees to the 30-day suspension for making a large number of unauthorized trades in the account of an investor Kempson knew was deceased. In the agreement, referred to as an AWC, Kempson neither admits nor denies fault.
The alleged facts are that in February 2007, A Kempson investor opened two investment advisory accounts with Kempson at the Firm. At the time, the investor signed an agreement with the Firm granting Kempson discretionary trading authority, the ability to make securities trades without first contacting the investor. A broker must contact an investor prior to the making of trades unless the broker has been granted authority by the investor in writing to make trades in an account.
On June 13, 2015, the investor passed away. Although Kempson was aware of the investor’s death since at least June 29,2015, Kempson did not inform his Firm of the investor’s death and continued to effect trades on a discretionary basis in the accounts.
Between June 29,2015 and April 5, 2016, Kempson effected a total of 40 trades in the deceased individual’s accounts. FINRA Rule 2010 requires members to observe high standards of commercial honor and just and equitable principles of trade. After the investor passed away, Kempson had no written authority to conduct any trades in the investor’s accounts. FINRA charged that, by effecting 40 trades in a deceased customer’s accounts, Kempson violated FINRA Rule 2010.
Additionally, in February 2017, Kempson was charged on felony weapons charges for the unlawful possession of a weapon. As stated in his CRD, he case is in front of the New Jersey Superior Court in Essex Vincinage. He has asserted that he is not guilty.