RJ and NEXT on hook for rogue rep

A rogue broker who has been kicked out of the industry has cost Raymond James Financial Services Inc. and NEXT Financial Group Inc. dearly — with the two firms paying out almost $850,000 to settle cases involving burned clients. And both independent-contractor broker-dealers could be on the hook for more. The broker, Gregory Horton, was barred from the securities business last month by the Financial Industry Regulatory Authority of Washington and New York. He was affiliated with St. Petersburg, Fla.-based Raymond James Financial Services from 1999 to 2004, and then joined NEXT Financial of Houston, where he stayed until March. So far, the two firms have settled eight arbitration claims involving Mr. Horton, with at least seven more claims pending, according to FINRA records. Two arbitration claims resulted in no action against Raymond James Financial Services and NEXT Financial. Raymond James Financial Services has paid $685,000 in settlements involving five claims. “There is one case pending about which we cannot comment,” said Anthea Penrose, a spokeswoman for Raymond James. Meanwhile, NEXT Financial has settled three claims totaling $162,000, according to FINRA records. Barry Knight, NEXT Financial’s chief executive, did not return calls seeking comment. Mr. Horton, who was based in Shrewsbury, N.J., allegedly churned a number of customer accounts and made unauthorized trades. Some of the claims involved variable annuities, according to records on FINRA’s central registration depository system. For the full report, see the upcoming Feb.11 issue of InvestmentNews.