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Registered Representative, Douglas F. Kaiser Fined, and Suspended in Relation to his Failure to Supervise US Treasury Securities Transactions

On November 11, 2022, FINRA sanctioned Douglas Fulton Kaiser of Boca Raton, Florida.  Kaiser, who is registered with Westpark Capital Inc., was fined $5,000.00 and suspended from association with any FINRA member in any principal capacity for three months.  In addition, he is required to attend and satisfactorily complete twenty hours of continuing education concerning supervision.  The sanctions stemmed from failing to supervise WestPark’s markups and markdowns for US Treasury securities.

Through the investigation, FINRA learned that Kaiser was the supervisor of WestPark’s fixed-income trading desk while a representative, who was recommending an unsuitable investment strategy characterized by the active, short-term trading of U.S. Treasury securities and charging excessive markups on certain transactions involving U.S. Treasury securities was registered at the firm. In his role, Kaiser was responsible for reviewing markups and markdowns on fixed-income transactions. For eight customers who suffered losses due to the representative’s Treasury-trading strategy, the representative charged, and Kaiser approved, markups or markdowns more than the firm’s policies allowed.   Kaiser failed to recognize and respond appropriately to the elevated markups and markdowns.  Moreover, for five of the eight customers, Kaiser miscalculated the markdowns the representative charged for certain sales on one day. Those sales were part of a group of same-day sales followed by purchases the following day that collectively amounted to “proceeds” transactions.

Without admitting or denying the findings, Kaiser consented to the sanctions and to the entry of findings that he failed to supervise his member firm’s markups and markdowns for U.S. Treasury securities. The suspension is in effect from December 5, 2022, through March 4, 2023.

Harmed investors can call (800) 718-1422 or email [email protected] to discuss their legal options. All consultations are free and confidential.   Most cases are handled on a contingency fee basis, meaning that clients are not obligated to pay attorney fees unless money is recovered on their behalf.