FINRA has moved to banish an ex-Wells Fargo broker from the industry for failing to cooperate with an investigation into allegations that he borrowed thousands of dollars from a 70-year-old customer without Wells Fargo's prior approval.
Andrew Lyman Quinn, who worked for Wells Fargo Advisors in Reno, Nev., allegedly borrowed a total of $64,000 from the customer from May 2009 to May 2010 in loan amounts ranging from $4,000 to $20,000. He purportedly directed the customer to transfer funds from her Wells Fargo securities account to her checking account and to issue him a check for the loan proceeds, according to FINRA's hearing panel decision to bar him.
The customer, a widow, had funded her securities brokerage account with the settlement proceeds from a medical malpractice lawsuit stemming from her husband's death, FINRA claimed.
Quinn signed three promissory notes, the largest for $53,000 payable in quarterly installments of $5,000 beginning in May 2010, according to FINRA's decision in late October.
Quinn's habit of borrowing from the widow continued after he left Wells Fargo for Stifel Nicolaus in June 2010. Having moved the client's account with him, Quinn borrowed an additional $3,000, in violation of the Stifel's policy prohibiting advisors from taking customer loans without the firm's approval. He also falsely denied having borrowed money from any customer in his annual compliance certification to Stifel, FINRA said.
In April 2014, when Quinn failed to make the required quarterly payments under the $53,000 promissory note, the customer complained to Wells Fargo. Wells Fargo settled the complaint in August 2014 for $25,000.
The customer also complained to Stifel when Quinn defaulted on his $3,000 loan. Stifel settled her claim by crediting $3,000 to her securities account in July 2014.
There was no evidence that he repaid any portion of the balance due the customer or that he repaid either firm, FINRA said. He allegedly made only two payments totaling $11,600.
Quinn did not respond to an email sent to him via BrightScope Advisor Pages, an online directory for bank advisors. He could not otherwise be reached for comment.
The regulator opened its investigation in August 2013, after receiving a complaint from the customer. Quinn, who at that point had already been discharged from Stifel, failed to respond to FINRA's repeated requests for information and in July 2015 waived his right to a hearing, admitting that he had borrowed money from the customer and lied to Stifel, as outlined in FINRA's complaint.
FINRA ultimately decided to bar Quinn for failing to provide the requested information and documents. Had he cooperated with the investigation, the sanction may have been less severe. For borrowing unapproved loans from the customer, FINRA's hearing panel concluded that a two-year suspension and a $20,000 fine was the appropriate sanction. For lying to Stifel, the sanction would have been a six-month suspension and a $10,000 fine. The suspensions would have run consecutively, had they been imposed, FINRA said.
Quinn, however, may still appeal the decision. If no further action is taken, FINRA's decision will become final on Dec. 10, according to an entry in Quinn's BrokerCheck report.
"It's not likely that he is going to have an appeal, but it's possible that he could have an appeal because he didn't settle the case," said Linda Riefbeg, an attorney with law firm Cozen O'Connor and a former chief counsel in FINRA's Enforcement Department. Riefberg explained that even though there's not much of a chance of an appeal, the formal process requires that the hearing panel's decision not be considered final until a window for an appeal has passed.
Emily Acquisto, a spokesperson for Wells Fargo Advisors, declined to comment on Quinn, saying only that he had been terminated in 2010. Stifel did not return email and voice messages seeking comment.