Training firm boss 'misappropriated' exam questions: Finra

The Financial Industry Regulatory Authority Inc. is suing an exam-preparation firm, alleging that its employees took registration tests with the intent of misappropriating the questions. In a lawsuit filed late last month in a California federal court, Finra claims that Christina Leahy, president of Training Consultants LLC of Santa Ana, Calif., and three of her children, all of whom work for the firm, took a total of 64 exams from 2001 through August 2012, with more tests scheduled into November. The self-regulator contends that the Leahys intentionally failed the tests and memorized test questions for later use by the firm's clients. Finra reuses some exam questions, the lawsuit says. The Leahys "failed 52 of the 64 examinations — a failure rate of over 81%, which is highly unusual," particularly given that the defendants all work for a test-training firm, Finra claimed in the suit. In an e-mail to InvestmentNews, Christina Leahy disputed the allegations. "Not only am I greatly disappointed at the accusations made in the suit but am saddened by the reckless disregard for the privacy of our family and employees," Ms. Leahy said. "We will vigorously defend against these claims and look forward to clearing our good name." Ms. Leahy added that she has "served the industry with outstanding training products and integrity for over 33 years and … provided 20 years of dedicated unpaid service to Finra's (formerly the NYSE) Series 7 item-writing committee." Finra seeks unspecified damages in the lawsuit and an injunction preventing Training Consultants from misappropriating test questions. U.S. District Judge Andrew Guilford of the Central District of California late last month denied Finra's request for a immediate temporary restraining order. A hearing on a preliminary injunction is set for Sept. 17. News of the Finra suit was reported earlier by Courthouse News Service.