Edward Beyn (CRD #5406273, Dix Hills, New York)

June 19, 2023 – An SEC decision became final in which Beyn was barred from association with any FINRA member in all capacities. The SEC affirmed the findings and the sanction imposed by the National Adjudicatory Counsel (NAC). The sanction was based on the findings that Beyn engaged in excessive trading in customer accounts over which he exercised de facto control. The findings stated that de facto control over customer accounts was established when nearly all the relevant trades were solicited, and the customers testified that they acquiesced routinely to Beyn’s recommendations and relied on his expertise. The findings also stated that Beyn acted with scienter and, accordingly, churned the accounts in violation of Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder. Beyn misled his customers about the true costs of their trading, which along with excessively high cost-to-equity ratios rendered it virtually impossible for the customers to profit from the trading. Beyn received $647,648 from the trading, deceived a customer about the importance of new account forms, and misrepresented on active account worksheets that his customers were “happy,” “satisfied,” or “very satisfied” with the performance in their accounts despite the losses. The findings also included that Beyn recommended three unsuitable ETNs to a 65-year-old customer. The ETNs were risky products for sophisticated investors and likely to decrease in value if held for more than short terms. Although the customer was an inexperienced investor, Beyn did not explain the risks, and the positions were held for long terms and resulted in losses of $42,498 from one of the ETNs and more than $20,000 from the other ETNs. Further, Beyn concentrated the customer’s limited retirement funds in the ETNs, placing 20 percent of his account in one of the ETNs and then 100 percent in the other ETNs. (FINRA Case #2015044823502)