Fired Merrill Lynch Rep Suspended Over Alleged Cryptocurrency Mining
Finra has suspended and fined a former Merrill Lynch broker over alleged cryptocurrency mining, according to news reports.
In December 2017, Kyung Soo Kim allegedly formed an S Corporation in which he was the sole shareholder and director to engage in cryptocurrency mining, entered into an agreement with another entity to supply the computer hardware and software for the activity, and transferred funds for the activity to the entity, FinanceFeeds.com writes, citing a June 10 letter of acceptance, waiver and consent published by the industry’s self-regulator.
Kim had been registered with Merrill Lynch from March 2014 until March 2018, when the wirehouse discharged him for failing to disclose outside business activity as well as “conduct involving alteration of a client document,” according to BrokerCheck.
He has not registered with another firm, according to Finra.
Kim agreed to a $5,000 fine and a one-month suspension without admitting or denying Finra’s findings, according to the letter of consent.
While the rest of the industry was grappling with the idea of cryptocurrencies as potential investment products, Merrill Lynch was quick to ban its roughly 17,000 advisors from peddling anything related to the most popular digital currency, bitcoin, in January 2018.
Only 1% of financial advisors now consider cryptos a viable investment product, and far fewer advisors are getting asked about them by clients than they were just a year ago, according to a recent survey.