UBS broker Howard Stuart Rothman was recently caught lying during a Finra arbitration proceeding. His perjury was acknowledged by the Finra panel in the arbitration award filing, and he was sanctioned $100k.
“This finding that a Finra member lied during arbitration must result in severe sanctions by Finra” – Jeffrey Sonn a nationally known securities lawyer.
“A finding of perjury like this is too rare. I have seen many Finra members commit perjury during testimony in arbitration and I am sick and tired of nothing being done. This is due in part to the failure of arbitrators to refer such misconduct to Finra for prosecution. I hope this changes. This award is the first time I’ve seen an arbitration panel with enough courage to make a finding of perjury. If Finra were to expel this person from membership it would send a strong message to the industry that perjury will not be tolerated.”
“Indeed perjury under oath in many states is a felony worthy of criminal prosecution. This award should be reviewed by the US Department of Justice because Finra arbitrations are subject to the Federal arbitration act and Finra was authorized by the SEC to be created and serve as the self regulatory organization for the securities industry.”
Here is the text from the award document describing Rothman’s false testimony:
On May 24, 2022, during the final hearing, Claimant filed a Motion for Sanctions in which he asserted, among other things, that Respondent Rothman falsely testified concerning his socalled “Trophy File” and when he took photos of emails; Respondents falsely testified that they “took nothing” with them when they left UBS because, according to them, they were instructed by counsel to take nothing; Respondents spoliated the Salesforce data, which Respondent Sturley testified showed who originated which customers and centers of influence; and Respondents’ counsel’s alleged orchestration of a ruse to deflect attention from the spoliation of the Salesforce data where counsel falsely represented that the Salesforce data was on UBS’ computer system, while knowing his representation was false. In their May 27, 2022, Opposition to Claimant’s Motion, Respondents argued, among other things, that Claimant’s arguments were false and fabricated. In his May 31, 2022, Reply in Support of his Motion for Sanctions, Claimant asserted, among other things, that Respondents’ Response to his Motion was a continuance of the deceitful and dishonest, calculated plan to steal Claimant’s 28% equity ownership in the partnership. The Panel ruling on Claimant’s Motion for Sanctions is set forth in the Award section below.
And here is the response by the panel:
As to the portion directed to at least one of the Respondents, the Panel finds that Respondent Rothman engaged in perjury by falsely testifying as to the creation of certain exhibits during the hearing and hereby awards sanctions of $100,000.00 against Respondent Rothman and in favor of Claimant. Accordingly, Respondent Rothman is liable for and shall pay to Claimant the sum of $100,000.00 in sanctions.