Finra has barred Andrew Yoro from the broker-dealer industry for allegedly cheating on his Series 7 exam when he was employed at Charles Schwab.
According to a Finra default enforcement decision, the SRO’s Department of Enforcement filed a complaint against Yoro for allegedly cheating on his Series 7 general securities representative exam in November 2017.
Finra alleges Yoro cheated by consulting during unscheduled breaks a study guide he had placed in his testing center locker, and then changing some of his answers.
Yoro, who joined Charles Schwab in October 2017, left the firm in July 2018.
The reason stated in Yoro's employment separation record on BrokerCheck is: “Mr. Yoro may not have followed the Finra Rules of Conduct in connection with his Series 7 examination.”
Yoro’s alleged actions were in violation of National Association of Securities Dealers Rule 1080 and Finra Rule 2010, according to the ruling.
NASD Rule 1080 states that an applicant for a qualification examination “cannot receive assistance while taking an examination.”
“It is also a violation of those rules to possess unauthorized study materials in a testing area, regardless of whether the materials were helpful or used to cheat,” according to the ruling.
Yoro was allegedly aware of the rules since he read and agreed to abide by the Test Center Rules of Conduct governing the exam, according to Finra.
The ruling states that the Department of Enforcement served Yoro with two complaint notices, but the respondent failed to respond to the complaint.
The investigation and complaint were triggered by an incident report submitted to Finra by the Series 7 testing center in Dallas.
Finra Rule 2010, meanwhile, requires a member to “observe high standards of commercial honor and just and equitable principles of trade” in the conduct of business.
A bar from the broker-dealer industry is a standard sanction for cheating during a qualification examination, according to Finra’s Sanction Guidelines.
The October 4 ruling states that the bar shall become effective immediately if the default decision becomes Finra’s final disciplinary action.
As of October 7, the regulatory action is still listed as ‘pending” in Yoro’s BrokerCheck record.
FA-IQ reached out to Charles Schwab and Yoro to get their comments on the alleged cheating and the disciplinary sanction but had not received replies as of this writing.