Former Approved
Person Disciplined
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Notice to Members #57/98
By way of an Offer of Settlement, Shelley Marie Brighton ("Brighton"), at the
time of the infraction an Approved Person employed by Global Securities Corporation
("Global Securities"), has agreed to the imposition of the following penalties
by the Exchange for violation of Exchange Rules F.1.02(2) and F.2.22(2):
- payment of a fine in the amount of $10,000;
- withdrawal of Exchange approval for a period of 2 years;
- disgorgement of commissions in the amount of $524;
- an assessment of investigative costs in the amount of $2,000, and
- should Brighton return to the industry, a requirement to be on strict supervision for a
period of 1 year and to re-write and pass the examination based on the Conduct and
Practices Handbook for Securities and Industry Professionals.
Rule F.1.02(2) states in part, that prior to accepting orders from a
third party for an account of any client, there must be on file a written trading
authority signed by the client empowering the third party to enter orders on the account.
Rule F.2.22(2) states in part, that an Investment Adviser shall not,
subject to Rule F.3.04, handle a discretionary order or exercise any discretion in the
handling of an account of a client of a member.
During the period of August 1, 1994, to July 31, 1995, Brighton
accepted orders from a third party on behalf of two client accounts and executed
approximately 26 trades in 2 US Over-the Counter securities valued at approximately
$613,888. The clients had given verbal authorization, but Brighton failed to have on file
a written trading authorization signed by the clients empowering the third party to enter
orders on the client accounts. Brighton thereby violated Rule F.1.02(2).
During the period of January 1994, to October 1997, Brighton exercised
discretion in three client accounts, executing 16 trades in five Exchange listed
securities valued at approximately $21,780. The clients had not given authorization for
Brighton to exercise discretion over the accounts and Global Securities had not accepted
the accounts as discretionary. Brighton thereby violated Rule F.2.22(2).
No fault was attributed to the Member Firm, who reported
Brighton’s conduct to the Exchange and terminated her employment.
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