FINRA Fines and Suspends Former WestPark, Skyway Rep for Unauthorized Private Transactions

The Financial Industry Regulatory Authority fined and suspended Mitchell S. Morrison for participating in private securities transactions without providing prior written notice to his member firms. Morrison first registered with FINRA in April 1981 as a general securities representative.

According to FINRA, between March 2018 and December 2020, while associated with WestPark Capital Inc. and Skyway Capital Markets LLC, Morrison served as president and chief executive officer of a financial technology company he created with another individual. During this time period, Morrison’s company allegedly engaged in a private offering which ultimately raised $462,500 through ten transactions.

FINRA says that Morrison provided neither WestPark nor Skyway with written notice that he intended to raise funds with his company, nor did he receive written approval from either firm to sell membership interests in his company. Furthermore, FINRA claims that Morrison falsely denied participating in any private securities transactions when completing compliance questionnaires with WestPark.

Per FINRA, these actions are a violation of Rule 3280 which states that, “[p]rior to participating in any private securities transaction, an associated person shall provide written notice to the member with which he is associated describing in detail the proposed transaction and the person’s proposed role therein and stating whether he has received or may receive selling compensation in connection with the transaction.”

A violation of Rule 3280 is also a violation of Rule 2010, which requires representatives to “observe high standards of commercial honor and just and equitable principles of trade” in their business dealings.

Without admitting or denying the FINRA findings, Morrison consented to a four-month suspension and a $5,000 fine.

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