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FINRA seeks to stop broker, CCO from misusing customer funds

Jan 25 2013 Stuart Gittleman, Compliance Complete

The Financial Industry Regulatory Authority has sought a temporary cease-and-desist order under Rule 9810 to immediately stop a broker-dealer and its chief compliance officer from misappropriating and misusing customer funds and securities. FINRA said the goal is to prevent further customer harm that would likely continue before a formal disciplinary proceeding against the firm and its executive could be completed. FINRA also charged the firm, Herkimer, New York-based Westor Capital Group, Inc., and Richard Hans Bach, its CCO, president, and financial and operations principal, with violating NASD Rule 2330(b) and FINRA Rules 2150 and 2010. Westor Capital also willfully violated Section 15 of the Securities Exchange Act of 1934 and Rule 15c3-3(b), FINRA alleged. Westor's primary business is trading microcap securities through its accounts at several brokerage firms. Because Westor has ineffective back-office systems for tracking and reconciling its customers' stock positions, the firm

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