The Financial Industry Regulatory Authority Inc. has suspended former Sigma Financial broker Frederick Randhahn for nine months and fined him $5,000 in connection with the sale of Woodbridge Group promissory notes.
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Finra said that Mr. Randhahn, who was discharged by Sigma in August 2018, sold $625,000 of the private notes without his firm's permission, which is a rule violation. In addition to the suspension and bar, Finra ordered Mr. Randhahn to disgorge the $33,167.67 in commissions he received from the sales of the securities.
Mr. Randhahn is no longer employed in the securities industry.
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In 2016 and 2017, the time period in which Mr. Randhahn made the sales, he failed to make any disclosure of Woodbridge to Sigma and denied participating in any private securities transactions or selling any nonsecurities investment products.
In December 2017, Woodbridge filed a voluntary Chapter 11 bankruptcy petition. On Dec. 27, 2018, the United States District Court for the Southern District of Florida issued final judgments against, among others, Woodbridge and its former owner, Robert H. Shapiro, requiring him and his firm to, among other things, disgorge their ill-gotten gains, Finra said in a letter of acceptance, waiver and consent. Mr. Shapiro was also required to pay a civil penalty.
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