Erez Law is investigating claims regarding John Wendland Handy Jr. (CRD #1580981, Madison, Wisconsin), Jonathan Craig Timson (CRD #2031301, Springfield, Missouri) and Dennis Walker (CRD #1058338, Verona, Missouri). Handy, Timson, and Walker recently submitted an AWC in which they were each assessed a deferred fine of $20,000 and each suspended from association with any FINRA member in any capacity for 18 months. See FINRA Case #2013038066601. The suspensions are in effect from March 2, 2015, through September 1, 2016. Handy, Timson, and Walker joined Wells Fargo Financial Advisors Network, Inc., in March 2007 as registered representatives in Springfield, Missouri, and operated under the name of Walnut Capital Management. Handy, Timson, and Walker were discharged by Wells Fargo in July 26, 2013, for failure to disclose the nature of their relationship with Signal Point Asset Management, LLC, according to their CRDs.
During its investigation, FINRA found that Handy, Timson, and Walker engaged in an outside business activity with Signal Point Asset Management and failed to adequately disclose their involvement in the investment adviser to Wells Fargo, who had denied their requests to hold ownership interest in Signal Point Asset Management. Because Wells Fargo denied their requests to hold ownership interest in Signal Point Asset Management, Handy, Timson, and Walker established the investment adviser with nominee owners acting in their stead, according to FINRA. FINRA found that the nominee owners agreed to transfer their ownership interests to Handy, Timson, and Walker if and when Wells Fargo permitted them to own Signal Point Asset Management. FINRA also found that Handy, Timson, and Walker participated in the management of Signal Point Asset Management, including making all important personnel decisions, participating in board meetings and determining how company assets were allocated. In addition, FINRA found that Handy, Timson, and Walker participated in private securities transactions and failed to disclose their participation in the transactions to Wells Fargo. In entering into the AWC, Handy, Timson, and Walker neither admitted nor denied FINRA”s findings.
FINRA Rule 3040, formerly NASD Rule 3040, provides that a broker may only sell securities with the knowledge and approval of his or her firm. When a broker sells securities without processing the order through the firm and without the firm’s permission or knowledge, this violates FINRA rules and is known as “selling away.” Federal and state law define securities broadly. Therefore, even products such as leasing arrangements or promissory notes, may be securities which require firm approval. Selling away often involves investment securities that are in the form of a private placement or other non-public investment.
Pursuant to FINRA Rules, member firms are responsible for supervising a broker’s activities during the time the broker is registered with the firm. Therefore, Wells Fargo, may be liable for investment or other losses suffered by customers of Handy, Timson, or Walker.
If you were a client of Wells Fargo, Walnut Capital Management, Handy, Timson, or Walker, and have suffered investment losses or financial irregularities or invested in promissory notes or limited partnership agreements, please contact Erez Law to explore your legal options, Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies. To learn more, please call us at 888-840-1571 or complete our “contact form.”