In a recent disciplinary action announcement, FINRA announced that Carl Max Birkelbach (CRD #1177843, Chicago, Illinois) was barred from association with any FINRA member in any capacity. The U.S. Court of Appeals for the Seventh Circuit denied Birkelbach’s petition for review of the SEC’s order imposing a lifetime bar. The sanction was based on findings that in the face of red flags, Birkelbach failed to exercise appropriate supervision over a representative’s handling of a customers’ account and, when violations were detected, failed to take corrective actions to prevent future misconduct. The findings stated that Birkelbach allowed the representative to churn the customers’ account for years while he did not take any meaningful action, never disapproved any trade and never questioned the amount of trading. Birkelbach was aware of the representative’s relevant disciplinary history and that he was the subject of arbitrations and numerous customer complaints, which should have prompted Birkelbach to heighten his supervision, but he failed to do so.
For the full FINRA findings, see FINRA case #2005003610701.
According to his FINRA Broker Report, Birkelbach was employed by Birkelbach Investment Securities from 1983 through 2011.
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