In an uncommon development, recently a statutorily disqualified broker was approved to return to the securities business.
FINRA filed a notice containing an application (“Application”) with the SEC seeking consent for Bowen to associate with First Liberties Financial as a general securities representative. In this Application, FINRA and First Liberties represented that non-registered person Bowen would be employed as a general securities representative on the firm’s institutional sales desk and compensated on a commission basis.
The SEC Division of trading and Markets (the “Division”) reviewed the Application and the record before FINRA. The Division concluded that it was appropriate for the SEC to approve the Application, which was so approved.
The original disqualification stems from the following facts. On October 27, 1999, the SEC issued an Order Instituting Administrative Proceedings that resulted in Gregory L. Bowen’s Bar from association with any broker or dealer, with the right to reapply for association after two years. He was also ordered to pay $33,664 disgorgement, $31,258 in interest, and a $5,000 civil penalty.
In the Order, the SEC alleged that while Bowen was employed with Government Securities Corporation (“GSC”) from July 1987 to December 8, 1997, he willfully violated Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder from March 1989 through March 1994. Specifically, it is alleged that he violated these rules by misrepresenting and omitting material information in his communications with clients in order to induce them to purchase high-risk collateralized mortgage obligations (“CMOs”). As a result of this Order, Bowen was deemed statutorily disqualified under Section 3(a)(39)(B) of the Exchange Act. Since 1999, Bowen has worked for various mortgage firms as a mortgage broker. He currently conducts a mortgage origination business.
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