James Stanley Gossett (CRD # 4574668, Registered Representative, Plano, Texas) submitted a Letter of Acceptance, Waiver and Consent in which he was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, Gossett consented to the described sanction and to the entry of findings that he made unsuitable investment recommendations to public customers, in that they were inconsistent with each customer’s financial situation, investment objective, circumstances and needs. The findings stated that Gossett, in verbal and written communications with customers, made misleading or unwarranted claims about his investment strategy, particularly regarding investment risks, and made predictions or projections of the future performance of the strategy without providing a sound basis for evaluating his assertions. The findings also stated that Gossett prepared and distributed to prospective customers sales literature about his investment strategy that failed to include risk disclosures and provided misleading information about past performance; provided incomplete and/or misleading information to customers about the performance of their investments and/or the account balance; and prepared an account statement for a customer in which he did not report all of the customer’s account holdings and thus reported an account balance that was greater than actual. The findings also included that Gossett exercised discretion in firm customer accounts without the customers’ prior written authorization and his member firm’s prior written acceptance.

FINRA found that Gossett enlisted the service of a non-registered individual to solicit investors to open accounts with Gossett, promote Gossett’s investment strategy, assist customers with completing application forms and serve as Gossett’s primary point of contact. FINRA also found that, as compensation for the services, Gossett agreed to pay the individual half of the commissions he generated from trades in the customers’ accounts. In addition, FINRA determined that Gossett opened a securities brokerage account with another FINRA member without providing written notice to his member firm and without advising the other firm of his association with a member firm; failed to disclose the account to his member firm after he opened the account; and failed to provide written notice to his member firm that he was engaged in an outside business activity. FINRA also found that, in response to a request for information, Gossett knowingly provided false and misleading information. (FINRA Case # 2007008653501)