Christopher Kennedy, Western International Broker, Barred from Securities Industry

FINRA, the self-regulator that oversees brokers and brokerage firms, has reportedly barred financial advisor Christopher Kennedy (CRD#: 4498061) from the securities industry, according to a letter of acceptance.

Kennedy reportedly agreed to the sanctions and to the entry of findings that he churned and excessively traded 4 accounts of 6 customers as a registered representative of his member firm, Western International Securities.

Kennedy has 11 customer complaints filed against him, according to FINRA. Western International reportedly discharged Kennedy in August 2021 after allegations of “unauthorized options trading and failure to adhere to discretionary options sales orders.”

Excessive Trading in Customer Accounts

The broker allegedly excessively traded customer accounts to generate commissions for his own benefit at the customers’ expense.

According to FINRA’s findings, Kennedy allegedly made an average of 102 trades per account per month representing net trading of more than $6.9 million per account or approximately 13 times the average account value.

Kennedy’s customers allegedly lost over $2.3 million in value from their accounts and the customers reportedly paid more than $715,000 in total trading costs and margin interest, including over $595,000 in commissions, according to FINRA.

FINRA also alleged that Kennedy made fake account statements to hide the results of his trading from two customers, the husband-and-wife co-trustees of a family trust account.

Fake Account Statements

Over six months, Kennedy purportedly prepared and sent six fake account statements to these customers from his personal email.

He is also accused of making a series of other false statements to these customers inflating their account value. In one instance, Kennedy allegedly sent a fake account statement to these customers purporting to show an ending balance of $5.2 million and a gain in value of over $3 million.

Instead, under Kennedy’s control the account reportedly had lost nearly all its value and only approximately $160,000 in value remained in the account. During FINRA’s investigation of his trading, Kennedy allegedly repeatedly lied to it in response to requests for information and on-the-record testimony. Kennedy reportedly falsely denied preparing fake account statements for customers and allegedly falsely claimed that his personal email had been hacked by an imposter who had sent all but one of the fake account statements.

Generating Commissions by Churning Accounts

Churning occurs when a broker makes an excessive number of trades within a client’s account, primarily for the purpose of generating commissions or fees for themselves.

These trades are typically unnecessary and serve no legitimate investment purpose. Instead, they are intended to generate income for the broker, often at the expense of the client. Churning can be costly due to transaction costs and capital losses due to the frequent trading.

Excessive trading and churning violate securities laws and regulations because it breaches the fiduciary duty that brokers and advisors owe to their clients. They are expected to act in the best interests of the client and not engage in trading solely to benefit themselves.

FINRA BrokerCheck Report – Christopher Kennedy

According to this FINRA BrokerCheck report, Christopher Kennedy was affiliated with the following firms during his career, among others:

12/02/2019 – 09/27/2021, WESTERN INTERNATIONAL SECURITIES, INC. (CRD#:39262), Woodland Hills, CA,   
B, 07/10/2019 – 12/23/2019, SPARTAN CAPITAL SECURITIES, LLC (CRD#:146251), NEW YORK, NY  
B, 08/21/2017 – 07/10/2019, WESTERN INTERNATIONAL SECURITIES, INC. (CRD#:39262), Tarzana, CA  
B, 01/27/2009 – 08/21/2017, FINANCIAL WEST GROUP (CRD#:16668) FINRA expelled the firm on 02/13/2020, Tarzana, CA

The FINRA BrokerCheck tool is a free online tool that allows investors to research and verify the background and credentials of financial brokers, brokerage firms, and investment advisors registered with FINRA. Investors can use the tool to verify if a broker or brokerage firm is registered with FINRA, review their employment history, licensing status, and any regulatory actions or complaints filed against them.

If you have suffered losses investing with Christopher Kennedy and Western International Securities, the securities attorneys at the White Law Group may be able to help you. For a free consultation with a securities attorney, please call (888) 637-5510.  
               

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm dedicated to helping investors in claims in all 50 states against their financial professional or brokerage firm. Since the firm launched in 2010, it has handled over 700 FINRA arbitration cases.

Our firm represents investors in all types of securities related claims, including claims involving stock fraud, broker misrepresentation, churning, unsuitable investments, selling away, and unauthorized trading, among many others.

With over 30 years of securities law experience, The White Law Group has the expertise to help investors to recover their fraud losses.    For more information, please visit our website, www.whitesecuritieslaw.com.