Finra bars former broker for unsuitable trades

In one example, Scott Allen Sibley allegedly exposed risk-averse retiree to naked options.

Former South Florida broker Scott Allen Sibley has been barred from the securities industry for allegedly making unauthorized trades for one customer, making unsuitable recommendations to 10 customers and then creating false records of the trades.

In a letter of acceptance, waiver and consent, the Financial Industry Regulatory Authority Inc. said that the former broker had been employed at Raymond James from November 2007 until February 2015, when he was terminated after the firm received multiple customer complaints “alleging unauthorized trading and improper use of time and price discretion.”

Mr. Sibley, of Pompano Beach, Fla., then worked for Moors & Cabot, which terminated him this past February.

In one case noted by Finra, Mr. Sibley had a 62-year-old client who could not work for medical reasons. The client, who had a low to moderate risk tolerance, wanted to preserve capital and generate income. In its letter, Finra said that Mr. Sibley initiated about 900 securities purchases and sales in the customer’s two accounts without authorization, knowledge, or consent. Of those transactions, 139 involved equity options where Mr. Sibley sold uncovered put option contracts or closed put option contracts without written authorization, causing a margin debit balance without the client’s authorization, knowledge or consent.