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Our law firm is investigating RedRidge Securities (“RedRidge”) based in Chicago, Illinois in connection with the supervision of former RedRidge Advisor Eric William Johnson (CRD No. 2142522) (“Johnson”). On October 7, 2014, Johnson entered into a Letter of Acceptance, Waiver, and Consent (“AWC”) with the Financial Industry Regulatory Authority (“FINRA”) wherein he consented to be barred in all capacities from associating with any FINRA member firm.
According to FINRA, “from approximately December 2006 through September 2014 (the “Relevant Period”), Johnson misappropriated more than $1,000,000 in customer funds from Firm brokerage accounts. During the Relevant Period, Johnson made at least 60 wire transfers of funds from at least six Firm customers’ brokerage accounts to his own personal bank accounts. The Firm’s wire transfer form required the signature of a Firm principal and the signature and seal of the Firm’s notary public. To effectuate certain wire transfers of customer funds to his personal bank accounts, Johnson falsified, or caused to be falsified, the signatures of a Firm principal and the Firm’s notary public, as well as the notarized seal.”
FINRA added that, “NASD Rule 2330(a), now FINRA Rule 2150(a), prohibits any person associated with a FINRA member from making “improper use of a customer’s securities or funds.” NASD Rule 2110, now FINRA Rule 2010, requires persons associated with a FINRA member to observe high standards of commercial honor and just and equitable principles of trade in connection with their business. By misappropriating customer brokerage funds totaling more than $1,000,000, Johnson violated NASD Rules 2330(a) and 2110, and FINRA Rules 2150(a) and 2010. Johnson also violated NASD Rule 2110 and FINRA Rule 2010 by falsifying, or causing to be falsified, on certain wire transfer forms, (1) the signatures of a Firm principal and notary, and (2) the notarized seals.”
According to FINRA’s BrokerCheck, during the Relevant Period, Johnson was registered with RedRidge. Under FINRA Rules, RedRidge was obligated to properly supervise the activities of Johnson during the time he was registered with the firm. Accordingly, RedRidge may be liable for failing to supervise Johnson’s activities while registered at the firm, and could potentially be responsible for compensating customers of Johnson for any potential losses.
If you were a customer of Johnson or have information relating to this investigation, please contact our law firm, toll free, at 1-888-997-9956.