FINRA Sanctions Three Brokers Over CMO Abuses

Law360, New York (September 4, 2008, 12:00 AM EDT) -- In its first penalties stemming from an industrywide probe, the Financial Industry Regulatory Authority has sanctioned three brokers from defunct brokerage firm SAMCO Financial Services for allegedly selling complex mortgage-backed securities to inexperienced investors, who lost $535,000.

On Thursday, FINRA announced that brokers Cindy Schwartz and Brian Berkowicz had been permanently barred from the securities industry, and broker John Webberly had been suspended for two years, for allegedly misrepresenting material facts or making unsuitable recommendations in selling sophisticated mortgage-backed securities known as collateralized mortgage obligations to...
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