FINRA Investigating UBS’s Phillip George Farmer For Unsuitability

Phillip George Farmer (CRD#: 2306865, Wilmington, Delaware) was a registered representative of UBS Financial Services Inc. from February 17, 2009 to January 6, 2016. On October 19, 2017, Financial Industry Regulatory Authority (“FINRA”) launched an investigation into Farmer’s sales practices.

Phillip George Farmer Suitability Investigation

FINRA BrokerCheck indicates that FINRA is investigating Farmer for possibly committing FINRA violations. FINRA believes that Farmer may have violated FINRA Rules 2010, 2111 and 4511 while he was employed with UBS Financial Services.
FINRA Rule 2111 generally states that a registered representative must have a “reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer, based on the information obtained through the reasonable diligence of the firm or associated person to ascertain the customer’s investment profile.” Therefore, FINRA appears to be investigating whether Farmer made unsuitable recommendations to UBS customers or placed unsuitable trades in UBS customer accounts.
FINRA BrokerCheck discloses that UBS Financial Services permitted Farmer to resign on December 7, 2015. UBS terminated Farmer during the time that Farmer was being internally reviewed by UBS Financial Services for improper trading practices.
In addition, FINRA BrokerCheck discloses that at least four customers have filed disputes about Farmer’s misconduct. Those customers maintained accounts at Morgan Stanley & Co. Incorporated and UBS Financial Services Inc. Customers have claimed that Farmer misrepresented investments, sold unsuitable securities and failed to follow instructions. Here is a summary of the disputes:
1) On January 26, 2009, a Morgan Stanley customer filed a complaint about Farmer’s conduct while he was the customer’s financial advisor. The customer alleged that Farmer misled the customer about her losses on preferred stock issued by Delphi. Apparently, Farmer told her that she would recover unrealized losses on her stock investments. The customer demanded $7,500.00 in damages as a result of Farmer’s misrepresentation. The complaint was denied by Morgan Stanley on February 9, 2009.
2) A customer of Morgan Stanley filed a complaint on December 14, 2009 in regards to Farmer’s activities. The customer stated that it was inappropriate for the customer to be placed in auction rate securities. The customer requested $150,000.00 as a result of the unsuitable municipal debt products held in her account. Morgan Stanley resolved the allegations by agreeing to pay the customer $150,000.00 in damages.
3) On December 22, 2015, a UBS Financial Services Inc. customer filed a complaint referencing Farmer’s alleged misconduct as his financial advisor. According to the customer, Farmer mismanaged the customer’s account and engaged in an unsuitable investment strategy. The customer alleged that Farmer placed his needs for commissions ahead of considering the customer’s investment returns. The customer sought more than $5,000.00 in damages. UBS Financial Services denied the complaint on April 8, 2016.
On December 7, 2015, Farmer became associated with Merrill Lynch, Pierce, Fenner & Smith Incorporated, located in Wilmington Delaware.

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