FINRA fined and suspended former Credit Suisse Securities and S F Sentry Securities (both of San Francisco, CA) broker Kai Nmn Chen aka Szu-Kai or Szukai Chen for improperly exercising discretion in multiple customer accounts without written authorization for clients who invested in IPO syndicate shares.
According to the findings, Chen, while associated with Credit Suisse's San Francisco office, improperly used discretion without written authorization for 179 customer security transactions in shares of initial public offerings, including 99 IPO share purchases for 18 customer accounts and 38 additional IPO sell transactions in 13 customer accounts. Investigators charged Chen with investing in securities on behalf of customers without their express written consent.
The findings state that Chen's client base included high net worth customers located in the United States and Asia.
FINRA also wrote that Chen effected purchase of IPO syndicate shares on customers' behalf without first having specific discussions with the customers about the transactions' terms as to issuer, price, and quantity, and without receiving or possessing written authorization to use discretion.
Furthermore, the report continues, these customers purportedly did not have discretionary accounts with Credit Suisse to begin with, which, in concert with Chen's failure to obtain any written authorization from these customers to engage in discretionary trading, constituted a violation of FINRA/NASD rules.
Kai Chen's BrokerCheck report indicates that Credit Suisse permitted Chen to resign from the firm in light of allegations that Chen failed to confirm transactional terms of syndicate shares with customers. It also reveals two settled customer disputes which resulted in over $10 million in payments to complainant customers, who in 2008 alleged, in part, that Chen invested in auction rate securities without their instruction to invest in such securities.
Kai Chen's Investment Adviser Representative Summary on the SEC website indicates current employment with Oceaniq Capital, LLC, located in Redwood Shores, California.
If you have invested with former Credit Suisse Securities (San Francisco) broker Szu-Kai Chen or with any broker or financial adviser who has engaged in discretionary trading in your account without your written authorization, permission, knowledge, or consent, and this unauthorized activity has proven harmful to your investments or interests through the incurrence of excessive fees, commissions, or outright investment losses, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.