Have you ever wondered what happens when financial advisors break the rules? FINRA fined TD Securities Kate Yumi Lam advisor for misusing firm funds.
Haselkorn & Thibaut has opened an investigation into Mrs. Lam and encourages investors to call for a free portfolio review.
This article will explain the case and its results.
Learn why following company policies is crucial in finance.
Key Takeaways
Table of Contents
- FINRA fined Kate Yumi Lam $10,000 for misusing $5,897.42 in TD Securities funds from July 2022 to March 2023.
- Lam charged 157 unauthorized car trips ($4,275.34) and 102 improper meals ($1,622.08) to her firm’s account.
- TD Securities fired Lam in May 2023 and filed Form U5 paperwork to report her policy violations to regulators.
- Lam’s actions broke FINRA Rule 2010, which requires high standards of conduct in the financial industry.
- This case shows how misusing company funds can lead to fines, job loss, and damage to a financial advisor’s career.
FINRA Investigation into Kate Yumi Lam
FINRA launched an investigation into Kate Yumi Lam’s financial activities. They focused on her use of firm funds and expense claims.
Misuse of Firm Funds
FINRA’s investigation into Kate Yumi Lam uncovered serious misuse of firm funds. Lam submitted claims for 157 car service trips, totaling $4,275.34. She also claimed $1,622.08 for 102 meals.
These expenses didn’t match TD Securities’ travel and expense policy.
Financial misconduct erodes trust and integrity in the industry.
Lam’s actions showed a pattern of inappropriate use of company money. Her questionable expense submissions led to a thorough FINRA inquiry. The investigation revealed Lam’s disregard for corporate fund policies and proper expense reporting practices.
Expense Claims
FINRA looked into Kate Yumi Lam’s expense claims from July 2022 to March 2023. They checked $5,897.42 worth of expenses she filed. Lam’s claims included 157 car service trips and 102 meals.
These expenses raised red flags during the audit.
The review of Lam’s financial records showed issues with her business expenses. Her expense reports didn’t match TD Securities’ rules for expense management. This led to a deeper probe into Lam’s compliance with the firm’s expense reimbursement policy.
The next section will discuss the specific violations of firm policy found in Lam’s expense claims.
Violations of Firm Policy
Kate Yumi Lam broke TD Securities’ rules. She misused company money for personal trips and meals.
Car Service Trips
Kate Yumi Lam broke TD Securities’ rules on car service use. She charged 157 trips to the firm’s account, totaling $4,275.34. These trips were against company policy. Lam used the car service for regular commutes before 8 p.m.
and other trips not covered by TD Securities’ rules.
Lam’s actions showed a clear misuse of the firm’s car service account. She racked up excessive charges for unauthorized travel expenses. Her behavior went against TD Securities’ guidelines for proper use of company resources.
This breach of policy led to serious consequences for Lam.
Meal Expenses
Kate Yumi Lam broke TD Securities’ rules on meal expenses. She charged 102 meals to the firm’s account, totaling $1,622.08. These charges included dinners when she wasn’t working late and meals on weekends when she wasn’t in the office.
Unauthorized dining charges can lead to serious consequences for financial advisors.
Lam’s actions went against company policy for food spending. She made improper meal reimbursements and misused company funds. Her unapproved meal expenses showed a clear breach of TD Securities’ expense guidelines.
FINRA’s Findings
FINRA found Kate Yumi Lam broke Rule 2010. She agreed to a censure and fine for her actions.
Violation of FINRA Rule 2010
FINRA Rule 2010 requires financial professionals to uphold high standards of commercial honor. Kate Yumi Lam broke this rule by misusing firm funds at TD Securities. Her actions went against the ethical conduct expected in the financial industry.
FINRA found Lam’s behavior violated their standards for proper business practices.
Lam’s misuse of company money led to serious consequences. She faced censure and a fine from FINRA for her misconduct. TD Securities also took action by firing Lam and filing the necessary Form U5 paperwork.
This case shows how breaking FINRA rules can harm a financial advisor’s career and reputation.
Acceptance of Censure and Fine
Kate Yumi Lam agreed to FINRA’s findings without admitting or denying them. She accepted the censure and a $10,000 fine as part of the regulatory action. This approval of FINRA’s decision shows Lam’s compliance with the disciplinary measures.
Her consent to the penalty marks an acknowledgment of the regulatory process and its outcomes.
TD Securities Actions
TD Securities took swift action after the FINRA investigation. They fired Kate Yumi Lam and filed the required paperwork.
Termination of Kate Yumi Lam
TD Securities fired Kate Yumi Lam in May 2023. The firm took this step because Lam broke their travel and expense rules. Lam’s actions went against the company’s policies, leading to her dismissal.
This move by TD Securities shows they take policy breaches seriously. The firm’s quick response highlights the importance of following company rules.
Lam’s termination came after she misused firm funds and made false expense claims. These actions violated FINRA Rule 2010, which requires high standards of commercial honor. The next section will explore the specific violations that led to FINRA’s findings against Lam.
Form U5 Filings
After terminating Kate Yumi Lam, TD Securities took steps to report the action. They filed a Form U5 in May 2023 to notify regulators of Lam’s departure. This form is a key part of compliance reporting in the securities industry.
TD Securities then filed an amended Form U5 in June 2023. The updated form gave more details about Lam’s policy violations. These filings show how firms must follow strict regulatory requirements when ending an employee’s work.
They also highlight the importance of accurate employment records in financial regulations.
Conclusion
Kate Yumi Lam’s case shows how FINRA keeps a close eye on financial advisors. Her misuse of firm funds led to serious consequences. TD Securities took swift action by firing Lam and reporting the issue.
This story serves as a warning to other advisors about following company rules. It also highlights the need for firms to have strong expense policies in place.
