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Florida Business, Whistleblower, & Securities Lawyers / Blog / FINRA / Former South Florida Broker Suspended for 2 Years

Former South Florida Broker Suspended for 2 Years

Pompano Beach resident and former Merrill Lynch broker, Charles E. Bishop, Jr., has been suspended by the Financial Industry Regulatory Authority (“FINRA”) for two years for allegedly attempting to misappropriate $3 million from one of his clients. According to Bishop’s Central Registration Depository BrokerCheck Report, he is suspended from association with any FINRA member from December 3, 2012 until December 2, 2014 and has been ordered to pay a $7,500 fine.

According to the Order Accepting Offer of Settlement dated September 10, 2012 (“Order”), Bishop had one of his elderly clients sign new account forms and transfer on death (“TOD”) paperwork indicating that upon her death, her Merrill Lynch account assets would be transferred to Dancing Bear Kennel, Inc., a company of which she was the registered agent and sole director.

FINRA asserted that, two days after the customer executed the TOD paperwork, Bishop formed Dancing Bear Dog Kennel, LLC, of which Bishop was the sole member. The Order alleged that a week or so later, the customer’s new account forms were altered and the Employer Identification Number (“EIN”) of the customer’s designated account beneficiary, Dancing Bear Kennel, Inc., was surreptitiously changed to the EIN of Bishop’s entity, Dancing Bear Dog Kennel, LLC. FINRA asserted that the customer neither authorized, nor was aware of, Bishop’s substitution of his company’s EIN number. FINRA claimed Bishop created an almost identically named entity and inserted its EIN number onto the customer’s forms with the intent of misappropriating the customer’s $3 million Merrill Lynch account after her death.

According to the Order, three days after the forms were altered, the customer passed away. FINRA claims Bishop filed a notice with the probate court indicating he was an interested party and beneficiary of the customer’s estate. The Order reflects that shortly thereafter, Merrill Lynch learned of the allegedly altered forms and terminated Bishop’s employment on April 1, 2009. The probate court then invalidated the TOD paperwork.

Bishop’s BrokerCheck report reflects that he was previously employed by numerous FINRA members including Morgan Stanley, First Union Brokerage Services, J.B Hanauer & Co., MetLife Securities and others. It also reflects that Bishop has been named in 8 customer complaints, one of which is still pending.

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