A veteran financial advisor based in suburban Houston was kicked out of the securities industry this week after reaching a settlement with regulators that claimed he "converted," meaning took, $9,000 from his broker-dealer, MWA Financial Services Inc., the broker-dealer unit for a fraternal order organization, Modern Woodmen Fraternal Financial, which opened in 1883, for his own gain.
Michael D. Dunlap first started working in the securities industry in 1990 and was barred yesterday, according to a settlement published by the Financial Industry Regulatory Authority Inc. In the Finra order, Dunlap agreed to the regulator's findings without admission or denial. He did not return a phone call Tuesday afternoon to comment.
Dunlap agreed to Finra's sanction "that he converted approximately $9,000 from his member firm's parent company," according to his BrokerCheck profile. MWA Financial Services "discharged," or fired, Dunlap, in 2022 for taking company cash and not returning it when confronted.
A fraternal organization is a brotherhood or a type of social organization whose members freely associate for a mutually beneficial purpose such as for social, professional or honorary principles, according to Investopedia.
"Dunlap also worked for the firm's parent company, a fraternal financial organization that is organized into chapters," according to Finra. "Dunlap served as the chapter leader for three chapters, and in his capacity as chapter leader, the parent company issued to him debit cards linked to each chapter's respective bank accounts."
"The parent company authorized Dunlap to use the chapter debit cards to pay for chapter events and community improvement projects," according to Finra. "Dunlap converted approximately $9,000 of chapter funds for his personal use by charging personal expenses to the chapter debit cards and withdrawing funds from chapter bank accounts without the parent company's authorization."
Personnel for Modern Woodmen Fraternal Financial did not return phone calls or emails Tuesday to comment.
"According to what’s alleged in this matter, it seems like the broker made a bad decision not to pay the money back to his firm, in effect causing him to have a permanent blemish on record for $9,000, a small amount of money," said Andrew Stoltmann, a plaintiff's attorney. "And he was given the opportunity to pay the money back, so it just sounds preposterous."
"Again, from what’s alleged, the financial advisor made a very bad career decision before spending the money and not giving it back," Stoltmann said. "Given these allegations, Finra could dive deeper into this advisor's customer related practices. The working theory in cases like this is that one instance of bad conduct by an advisor could represent the tip of the iceberg."
In an era of AI euphoria and market FOMO, getting back to basics with fixed income may be the most contrarian and most important move advisors can make.
Voya Financial adds private equity, credit and real estate options to its AMA program, building on support for looser federal investment rules in retirement accounts.
Shannon Reid, president of Osaic and the network’s number two executive, has plenty of challenges, industry executives said.
Auditors flagged the commingling. The COO allegedly knew. Investors kept getting the pitch
The advisors on the move include two brothers leading a family practice in Connecticut, and a husband-and-wife tandem working with business owners in the West Coast.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
