Forgery means your broker wrongfully signed your name without your permission, copied and pasted your signature, or altered documents you already signed. Our FINRA arbitration lawyers will tell you there is likely a forgery of some type in every case. Your broker is not permitted to sign your name without a power of attorney, or maintain and use photocopies of your signature. If you notice your signature on documents you do not recall signing or activity in your account that you did not authorize, it may be a clue that your broker committed forgery. A securities law forgery law firm in New York like Malecki Law can review your potentially forged documents in a free consultation.Relevant FINRA Rules
FINRA may sanction and fine brokers for engaging in forgery, as it is a violation of FINRA Rule 2010. If the forged document at issue is a book or record, the broker has also violated FINRA Rule 4511. If you notice your signature on documents you do not recall signing or activity in your account that you did not authorize, it is possible that your broker forged your signature to conduct unauthorized transactions. A New York securities law forgery attorney at Malecki Law will review your documents at no cost. When determining sanctions against a broker, FINRA considers numerous factors, including the nature of the document at issue and whether the broker had been mistaken at the time of committing the forgery.
Under FINRA Rule 3110(a), firms are required to properly supervise the activities of their associated persons, including potential forgery. Firms have a duty to detect any red flags related to forgery. Although moving to digital documentation creates efficiency for brokerage firms, it also poses additional forgery risks for clients like yourself, including forged signatures on digital documents such as account opening and risk tolerance forms. If you notice a forged signature on documents that you have not seen before, your broker may have committed forgery. An experienced securities law forgery lawyer in New York at Malecki Law is skilled at looking for telltale signs of forgery. Forgery can lead to other misconduct, including misrepresentations and fraud. In some instances, brokers have forged their clients’ signatures to falsely authorize them to do something within the clients’ accounts, such as unauthorized trading.FINRA Has Seen an Increase in Forgery and Holds Firms Accountable
FINRA has reminded firms how important it is to maintain sufficient supervisory systems in order to detect potential signature forgery. In its Regulatory Notice 22-18, FINRA pointed out that there has been “an increasing number of reports regarding registered representatives and associated persons forging or falsifying customer signatures, and in some cases signatures of colleagues or supervisors, through third-party digital platforms.” FINRA went on to say that firms have even “identified signature issues involving a wide range of forms, including account opening documents and updates, account activity letters, discretionary trading authorizations, wire instructions and internal firm documents related to the review of customer transactions.”
As technology has advanced and brokerage firms’ documents and forms continue to move to the digital space, potentially forged digital signatures have become an even more prominent issue. There are methods FINRA suggests that firms can put in place to identify forgery as it relates to digital signatures, including customer inquiries or complaint investigations, digital signature audit trail reviews, email correspondence reviews, administrative staff inquiries, and customer authentication supervision.
FINRA holds brokers and brokerage firms accountable for forgery. For example, FINRA suspended and fined broker Mark Lloyd Post. The broker allegedly forged customers’ signatures and falsified documents related to transactions in the customers’ accounts. If something similar happened to you, contact a New York securities law forgery law firm like Malecki Law to assess your potential case. Another example, FINRA barred broker Thomas Patrick Barton III. The broker allegedly forged electronic signatures on applications for insurance policies. Both instances were without authorization or consent given by the clients. Another example, FINRA suspended broker Joffre Salazar. The broker allegedly forged his clients’ signatures on documents to purchase a seven-year fixed annuity, meanwhile, the clients only consented to a five-year fixed annuity.