Ex-UBS Broker Fined And Suspended Over Client Texts

The Financial Industry Regulatory Authority has suspended a former UBS Wealth Management USA broker for 45 days and fined him $7,500 for using his personal cell phone to communicate with customers. 

From June 2018 to April 2020, Zachary Hansen sent business-related texts to two customers without approval or supervision by the firm, according to a settlement finalized on Thursday. The texts discussed account performance, transactions and market events, according to the regulator. 

Finra said Hansen caused UBS to violate the self-regulator’s Rule 4511 requiring preservation of accurate books and records and business-related client communications for a period of at least three years because the texts were not logged. A violation of Rule 4511 also triggered a violation of Finra’s catch-all Rule 2010 requiring “high standards.” 

Finra has been cracking down on brokers’ texting habits in the era of remote work, a focus that has coincided with broader scrutiny of texting on Wall Street by other regulators. In June, Finra issued a $5,000 fine and 30-day suspension against ex-UBS broker Ramiro L. Colon III based on allegations that he used WhatsApp to communicate with a client without telling the firm.

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(UBS in July disclosed it also expects to pay a penalty over employees’ texting and booked a substantial portion of legal reserves on its Global Wealth division’s balance sheet.) 

Hansen, who was a wholesaler before joining UBS in 2015, accepted the penalty without admitting or denying the findings. He first registered at TransAmerica and spent a year at Mutual Trust Co. of America before joining UBS, according to BrokerCheck. 

The ex-broker’s lawyer, Andrew R. Shoemaker in Boulder Colorado, did not immediately return a request for comment. 

UBS terminated Hansen in August 2020 for violation of firm policy, including facilitating selling away, inappropriate use of electronic communications with clients, mishandling of customer complaints and failure to disclose personal investments along with an outside business, according to BrokerCheck. 

The wirehouse also settled two client claims tied to Hansen in April 2020, according to the database. One customer who alleged unauthorized trading in a mutual fund said his account had been listed as moderate risk even though he was a conservative investor. It settled for $42,500 of unspecified damages. 

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The second, which also traced back to December 2019 and involved an unspecified mutual fund, settled for $23,098 over an unsuitable and unauthorized investment. Hansen did not contribute to either settlement. 

Hansen has not been registered since his departure from UBS. His LinkedIn profile shows he is founder and present of “Power Hour Ventures” and has an investor relations position with Grip Places, a company that streams video from the inside of bars and restaurants in Colorado and Arizona.

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