Finra said that another compliance officer at the firm later learned that the rep forged the signatures or initials for nine customers on variable annuity applications. “The compliance officer scheduled an unannounced branch exam for seven months later—which confirmed that [the rep] had altered documents, among other infractions. The compliance officer consulted other members of the compliance department but not the [supervision regional vice president] or the compliance personnel previously involved in disciplining [the rep]. The firm did not place [the rep] under heightened supervision at any time and did not consider whether his conduct required reporting under Rule 4530(b).”
After that, the rep converted over $400,000 in customer funds by forging variable annuity withdrawal forms, Finra said. The rep was barred in 2016, the agency added, and the clients made whole.
In June 2020, SagePoint was fined $300,000 by Finra for failures to supervise the suitability of its representatives' recommendations of unit investment trust rollovers. The firm also had to pay $1.3 million in restitution to customers.
SagePoint, based in Phoenix, is part of the Advisor Group, which ranked third in Financial Advisor's 2021 independent broker-dealer survey, and currently lists $475 billion in client assets under management. Its other subsidiaries include FSC Securities Corporation, Royal Alliance Associates, Triad Advisors, Woodbury Financial Services, Ladenburg Thalmann Asset Management and Securities America Advisors.
SagePoint's assets under administration are $45 billion, according to the Advisor Group website. Finra said SagePoint has 1,800 registered reps in 800 branch offices.