Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Jin Lim (Lim), previously associated with Barclays Capital Inc., has at least one disclosable event. These events include one tax lien, alleging that Lim recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a final customer complaint on January 29, 2025.
Without admitting or denying the findings, Lim consented to the sanctions and to the entry of findings that he violated FINRA Rule 2010 by acting in contravention of Section 17(a)(3) of the Securities Act in that he engaged in 32 instances of spoofing in US Treasury Securities. The findings stated that Lim entered a larger, fully displayed order on one side of the market, generally for $25 or $50 million, in 5- or 10-year notes with intent to cancel that order at the time he placed it. Simultaneously, Lim had a smaller order on the opposite side of the market in the same product with only a portion of the vale displayed. Other market participants would react to Lim’s larger, fully displayed order in a variety of ways including moving their resting order prices up or down, withdrawing any orders resting opposite the larger, fully displayed order, or placing aggressive orders to execute against orders resting opposite the larger, fully displayed order. In 15 of the 32 instances, Lim received executions on his smaller, iceberg orders while his larger, fully displayed orders were in the market. In each of the 32 instances, because Lim intended to cancel each larger, fully displayed order at the time he placed it, these orders falsely signaled a shift in buy or sell interest through their impact on the stack.
Brokers are required to adhere to the SEC’s Regulation Best Interest (Reg BI) standard of care under the Securities Exchange Act of 1934 which establishes a ‘best interest’ standard for broker-dealers and associated persons. This standard applies when a registered representative is providing investment advice through making recommendations customers and covers securities transaction, investment strategies, and recommendations concerning advice on opening of an account or accounts. Reg BI is drawn from fiduciary principles that include an obligation to act in the retail investor’s best interest and the broker is prohibited from placing their own interests ahead of the investor’s interest.
There are several different aspects of the rule that brokers must comply with. One of which is the care obligations which requires brokers to form a reasonable belief that their investment advice and recommendations are in the retail investor’s best interest. The care obligations includes three components. First, the advisor must have an understanding of the potential risks, rewards, and costs associated with a product, investment strategy, account type, or series of transactions. Next, the advisor must have a reasonable understanding of the specific retail investor’s investment profile. The customer’s profile information generally includes an investor’s financial situation and needs; investments; assets and debts; marital status; tax status; age; investment time horizon; liquidity needs; risk tolerance; investment experience; investment objectives and financial goals; and any other information the retail investor may disclose in connection with the recommendation or advice. The associated person must then apply both their reasonable diligence into various investment options as well as the information gathered as to the investor’s specific needs when considering the investment recommendation. The broker must explore various alternative investment options available to address these needs and determine that there is a reasonable basis to believe that the recommendation or service being recommended is in the retail investor’s best interest.
An advisor must understand the type of account, securities, and their client in order to meet their care obligations. The type of securities account has the potential to greatly affect retail customers’ costs and investment returns. Different types of securities accounts can offer different features, products, or services, and not all types of accounts or services would be in every investor’s best interest.
Lim has been in the securities industry for more than 5 years. Lim has been registered as a Broker with Barclays Capital Inc. since 2021.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.
