FARMER, PADGETT and TAYLOR named in FINRA Complaint Alleging Undisclosed and Unapproved Outside Business Activity

“John Lodge Farmer (CRD #5354041, Prescott, Arizona), Jodi Oyler Padgett (CRD #1828918, Skull Valley, Arizona) and Charles Edwin Taylor (CRD #443066, Prescott, Arizona) were named respondents in a FINRA complaint alleging that they engaged in an undisclosed and unapproved outside business activity involving the sale of precious metal bullion coins.  The complaint alleges that the outside business activities included referring individuals to the dealer of precious metals for the purpose of those individuals purchasing bullion coins and the dealer paying a referral fee as compensation.  Farmer, Padgett and Taylor made referrals that involved their member firm’s customers.  In connection with these referrals, the dealer paid referral fees to Farmer totaling approximately $4,663, to Padgett totaling approximately $5,676 and to Taylor totaling approximately $10,081.

The complaint also alleges that Taylor failed to reasonably supervise Padgett and Farmer by failing to enforce the firm’s WSPs with regard to their participation in the referrals to the dealer.  Among other things, Taylor failed to take reasonable steps to ascertain that this activity was disclosed in writing to the firm as an outside business activity in the form required by the firm.  Taylor also failed to take reasonable steps to ascertain that the referrals of firm customers to the dealer was an activity prohibited by firm policy.  (FINRA Case #2017053382401)”

* A hearing panel decision was issued on August 22, 2019. To read the decision visit here.

The information above was obtained via FINRA’s website. It is for informational purposes only and is not legal advice. It is provided only as general information which may or may not reflect the most recent developments. Check FINRA’s website for the most current information.

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Financial Industry Regulatory Authority, Inc. (FINRA) is an independent, non-governmental regulator who oversees the people and firms that sell stocks, bonds, mutual funds and other securities to the public in the United States. They are authorized by Congress to protect investors. They do this by making sure the securities industry operates fairly and honestly with the public.