Finra slaps broker with six-month suspension for failing to report $1 million in tax liens

Kevin Graetz was also fined $10,000 for not updating U4s over seven years.
MAY 16, 2017

Former broker Kevin Richard Graetz has settled a Finra complaint alleging that he failed to report federal and state tax liens against him totaling more than $1 million over almost seven years. The Financial Industry Regulatory Authority Inc.'s Form U4 requires registered personnel to disclose whether there are any unsatisfied judgments or liens against them. In amendments Mr. Graetz filed to his Form U4 in February 2013, January 2014 and February 2014, he "inaccurately and misleadingly" indicated that he was not subject to any unsatisfied tax liens, according to a Finra order accepting an offer of settlement. (More: Finra advances proposals to crack down on 'high-risk' brokers, unpaid arbitration awards) Mr. Graetz, whose employment with Paulson Investment Co. in New York ended on April 28, updated his Form U4 to disclose his unsatisfied liens in May 2014, only after Finra uncovered the liens during a cycle examination of his firm. Finra said that Mr. Graetz's "failure to disclose the tax liens was willful in that he knew that he owed significant unpaid taxes and that he was subject to unsatisfied tax liens." Over the years, the Internal Revenue Service recorded a laundry list of federal tax liens against Mr. Graetz, including liens of more than $43,000 in February 2007; $16,500 in February 2009; $179,000 and $206,000 in August 2009; $370,000 in September 2009; $206,000 and almost $56,000 in September 2010; and almost $96,000 in July 2011. On January 18, 2013, the State of Connecticut recorded a tax lien against Mr. Graetz in the amount of $25,938. (More: Advisers getting left behind as broker-dealers respond to Finra priority letter) Finra said Mr. Graetz received notice of each of the state and federal tax liens entered against him. Related article: Introduction to tax lien investing As punishment, Finra suspended Mr. Graetz for six months and fined him $10,000. Mr. Graetz, a resident of New Canaan, Conn., has spent 25 years in the securities industry and joined Paulson in 2013. He previously was affiliated with Roth Capital Partners, Advanced Equities (which has been expelled by Finra), Oppenheimer & Co., Maxim Co., Ryan Beck & Co., H.C. Wainwright & Co., Josephthal & Co., Tucker Anthony, PaineWebber, Rosenkrantz Lyon & Ross and Gruntal & Co.

Latest News

Retirement delays, Social Security fears prompt advisors to rethink income strategies
Retirement delays, Social Security fears prompt advisors to rethink income strategies

Concerns about outliving savings and healthcare costs are reshaping how "Peak 65" Americans and advisors approach income planning.

Merrill Lynch on the hook for $3.7M after clients claimed sale of unsuitable private equity
Merrill Lynch on the hook for $3.7M after clients claimed sale of unsuitable private equity

Some investors recently have seen million dollar plus decisions by FINRA arbitration panels involving complex products decisions go their way.

Barred ex-Merrill Lynch advisor arrested in alleged $2.6M theft of former Miami Dolphin Pro Bowler
Barred ex-Merrill Lynch advisor arrested in alleged $2.6M theft of former Miami Dolphin Pro Bowler

Former advisor Isaiah Williams allegedly used the stolen funds from ex-Dolphins defensive safety Reshad Jones for numerous personal expenses, according to police and court records.

RIA moves: Modern Wealth tops $8.5B AUM as Aspen expands in Connecticut
RIA moves: Modern Wealth tops $8.5B AUM as Aspen expands in Connecticut

Modern Wealth's latest deal for a California-based fee-only RIA marks its fourth acquisition of 2025.

Empower defends private market access in 401(k)s in response to Warren scrutiny
Empower defends private market access in 401(k)s in response to Warren scrutiny

Sen. Warren has warned of private market investment risks due to opacity, illiquidity, and past regulatory issues.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.