December 10, 2020
On November 10, 2020, registered representative John Westbrook consented to sanctions imposed by the Financial Industry Regulatory Authority (FINRA) Department of Enforcement to resolve allegations of participating in private securities transactions without prior disclosure or approval to his member firm.
Westbrook was associated with Center Street Securities, Inc. in Montgomery, Alabama from September 2014 to February 2020. He was also briefly associated with Cape Securities Inc. in McDonough, Georgia from May to June 2020, but is not currently registered at a FINRA member firm.
According to the Letter of Acceptance, Waiver and Consent (AWC), Westbrook participated in private securities transactions (PSTs) totaling over $350,000 between October 2016 and May 2017, and receiving $14,013 in commissions, without providing prior notice or obtaining approval from Center Street Securities. Specifically, Westbrook solicited three investors to purchase securities of Future Income Payments, LLC (FIP), a company that claimed to be a structured cash flow investment that purchased pensions at a discount and then sold portions as a “pension stream” to investors. The company promised investors a seven to eight percent return on their investment.
In April 2018, FIP ceased business even though the company owed $300 million in unpaid investor payments. FIP and its owner, Scott A. Kohn, were charged in federal court with conspiracy to engage in mail and wire fraud.
Based on the foregoing, Westbrook violated FINRA Rules 3280 and 2010. Westbrook consented to a five-month suspension from associating from any FINRA member firm and a $5,000 fine.