Trustee-elect Misused Client’s Funds
Anderson Township Trustee-elect Kevin O’Brien lost his securities license in September for misappropriating a client’s funds.
Financial Industry Regulatory Authority, Inc., the enforcement agency for securities brokers, reported that O’Brien was barred from any association with any securities dealer affiliated with FINRA on Sept. 14, 2009.
O’Brien must post a bond before being seated as a township trustee. He refused to sign the form for a bond that other Anderson trustees use, which gives them a $10,000 bond at no cost to them, and he has posted a $1,000 bond using another underwriter.
O’Brien formerly was a vice president in the Cincinnati office of Robert W. Baird & Co., Inc., investment management company. He now does business as O’Brien Private Wealth Management, Anderson Township.
The FINRA report says O’Brien transferred $378,000 between a client’s accounts, using some of the money to pay the customer’s expenses and misappropriating the rest for his own use.
The report says Baird & Co. settled with the unnamed client for $336,175. It says the client filed the complaint Dec. 17, 2008, and Baird & Co. settled by June 18, 2009. The report also says O’Brien failed to notify Baird & Co. that he was engaged in outside business.
“Without admitting or denying the findings, O’Brien consented to the described sanction and to the entry of findings; therefore he is barred from association with any FINRA member in any capacity,” the FINRA report says.
So far, O’Brien has not been charged with a crime, and he apparently can legally be installed as a township trustee. A felony conviction would make him ineligible.
Ohio law provides for residents of the township to ask the Hamilton County Municipal Court to require a higher bond. Ohio Revised Code Section 505.02, last revised in 1982, sets the minimum at $1,000, but Section 505.03, effective in 2005, provides for a petition of at least 12 freeholders to require a higher bond.
A petition from 20 residents went to the court December 21.
If a trustee does not post bond within 10 days of having to do so, the office becomes vacant, and the remaining trustees appoint a replacement. They may choose any eligible elector in the township.
O’Brien won the election November 3 to a four-year term on the Anderson Township Board of Trustees, which begins Jan. 1, 2010. With two elected, Peggy Reis was first with 6,841 votes, O’Brien second with 6,018, Greg Delev third with 5,987, incumbent Albert Peter fourth with 4,802 and Michael Paolucci fifth with 3,778.
Want More Information from Other Sources?
Download a copy of the FINRA Report on Kevin Paul O'Brien and read it for yourself - Click Here
Received on January 11, 2010 - FINRA Letter of Acceptance, Waiver and Concent (AWC) - To Download the FINRA AWC - Click Here
February 18, 2010 - Judge Upholds Baird Subpoena in O'Brien Court Case. To read about it - Click Here
To read the original story in the Cincinnati Enquirer - Click Here
To read a follow-up story in the Cincinnati Enquirer - Click Here
To read the Cincinnati Enquirer article concerning O'Brien's admission that he had an "error of judgement" then - Click Here
Read Enquirer Reporter Howard Wilkinson's Politics Extra on O'Brien - Click Here
Another article from Howard Wilkinson on O'Brien - Click Here
Channel 12 WKRC's Story on O'Brien - Click Here
To read a story in the Cincinnati Enquirer about O'Brien's first Trustee Meeting - Click Here
WXIX Channel 19's Coverage of O'Brien's first Trustee Meeting - Click Here
O'Brien Saga Goes National! Several Stories from the Nationally Published Investment News
To read the December 23, 2009 Investment News Article - Click Here
To read the January 3, 2010 Updated Article in Investment News on O'Brien - Click Here
To read the January 15, 2010 Updated Article in Investment News on O'Brien - Click Here
To read the April 29, 2010 Article in Investment News on Baird's lawsuit against O'Brien - Click Here
The O'Brien Private Wealth Management Website (Click Here to visit that website) makes various claims on the services he offers. Contact the SEC and State of Ohio if you believe O'Brien offering those services is in violation of state and federal laws. Additional note: the address listed for O'Brien Private Wealth Managment on the Anderson Area Chamber of Commerce Website is nothing more than a mail box at the local UPS Store which is located at 8190 Beechmont Avenue, Cincinnati, Ohio 45255.
If you would like to visit Kevin P. O'Brien's websites, you can find them here:
O'Brien for Trustee - http://www.obrienfortrustee.com
Another O'Brien for Trustee - http://friendsofkevinpobrien.com
O'Brien Personal Website - http://kpo.name
Another Personal Website -http://www.kevinpobrien.com
O'Brien seems to minimize the loss of his license. We suggest you call your personal stock broker and ask your trusted professional what it means to lose the license and have a permanent ban. You will quickly learn from your broker that the loss of this license can only be from an extremely serious violation and that a permanent ban is big.....really big.
Here's More Ways You Can Help!
If you believe that it is against the law for O'Brien to operate "O'Brien Private Wealth Management" (http://www.obrienpwm.com) when he no longer has a stock broker's license, then you can file a complaint with the United States Securities and Exchange Commission (SEC). The link to the SEC website for filing the complaint can be found here - Click Here
The FINRA report (you can download a copy above) shows that Baird made restitution to the customer or customer(s). It is unknown if O'Brien declared the "misappropriated" funds as income to the IRS and to the State of Ohio. If you believe that O'Brien may not have paid taxes on those funds, you may file a complaint with the Internal Revenue Service - Click Here
If you believe that only persons of character and integrity should be allowed to be members of the Anderson Area Chamber of Commerce, contact the chamber and give them your opinion on O'Brien's membership in that fine organization. To see his profile on the chamber website - Click Here - To contact the chamber - Click Here
To send an email to Kevin O'Brien to ask him to resign - Click Here
Residents Petition Court for Higher Bond
On Monday, December 21st, a group of Anderson Township property owners filed petitions with the Hamilton County Court system requesting that a judge determine that additional security be posted for the state-required surety bond of trustee-elect Kevin P. O’Brien. These petitions, consistent with Ohio law, contemplate that a hearing would be held to allow them to present evidence to the judge showing that significant additional security to safeguard the interests of Anderson Township taxpayers is necessary and appropriate in light of the recent disclosure of O’Brien’s firing and permanent brokers license revocation resulting from his misappropriation of funds from a client’s account for his own use and benefit.
O’Brien publicly admitted that he had himself surreptitiously sworn into office by a Notary Public and it has now been confirmed that he also refused to sign and submit the standard surety bond application, which is provided to elected officials, at no charge, by Anderson Township’s insurance carrier, OTARMA and is used extensively by elected township officials across the state. O’Brien secretly obtained his own bond, apparently so as to avoid disclosure of his ethics violations and the disciplinary action that resulted. It is unknown as to whether O’Brien disclosed this information to his surety carrier.
Although O’Brien stated to the press this past week that “all parties have been satisfied,” public records show that his employer, R.W. Baird & Co., made a settlement payment in the amount of $336,175.00 to the client. However, if O'Brien did not reimburse Baird, then all parties do not seem to have been satisfied. Some Anderson residents intend to ask the Internal Revenue Service to look into whether or not the monies taken by O’Brien were reported by him as income.
O’Brien continues to operate his own financial consulting business in Anderson, in spite of the fact of his license revocation by the SEC and its regulatory arm, FINRA, which specifically prohibits his giving any advice regarding stocks, bonds, mutual funds, etc. At least one formal request for an investigation of his current practices has been filed with the Division of Enforcement at the United States Securities and Exchange Commission in Washington, D.C.
A large and growing group of outraged Anderson residents, many former O’Brien supporters and neighbors, have begun formulating plans to press for O’Brien’s resignation or to seek legal remedies to remove him from office. Some members of the group may be on hand Tuesday evening to protest at O’Brien’s “public recognition” event, others may come for the purpose of observing who might be in attendance.
Report from the December 23 O'Brien Press Conference
Kevin O’Brien said at a Wednesday
morning press conference that he provided good services in the case
that led to his being barred from the investment business.
O’Brien, who takes office as a member
of the Anderson Township Board of Trustees January 1, was permanently
barred from association with any investment brokerage under the
jurisdiction of the Financial Industry Regulatory Authority, Inc.,
the enforcement agency for securities brokers. FINRA reported its
action on Sept. 14, 2009.
O’Brien acknowledged that he did not
notify his former employer, Robert W. Baird & Co., Inc., of his
business relationship with the client, a violation of FINRA rules. He
acknowledged that FINRA had disciplined him for the same offense with
a different client before, which he said was “years earlier.” The
earlier action was in 2005. He paid a $2,500 fine and served a 10-day
suspension, which he said he took during Christmas Holidays.
O’Brien described a situation in
which a long-time client of his had fallen into personal and
financial difficulties. He said that mail to the client returned as
undeliverable, and that he investigated and found that the client has
been in a facility in Virginia. O’Brien said the client requested
his help in straightening out his finances in 1998, and that he did
extensive work in paying off back taxes, bills and liens and in
getting the client’s financial affairs in order.
O’Brien said he had written
representation agreements with the client, representing the client
personally, not through Baird & Co.
He also acknowledged that the client
was mentally impaired.
The client’s lawyer later filed the
complaint against O’Brien.
O’Brien read two prepared statements
to reporters at the conference, held at the Anderson Senior Center,
but would not release copies.
He declined to discuss details of the
client relationship, referring to privacy requirements and saying the
settlement details are not in the public record.
He said that his current business,
O’Brien Private Wealth Management, Anderson Township, does not
require any license or approval through any government regulator.
O’Brien said he has presented a $1,000 bond that all township trustees must have to the Hamilton County Municipal Court. He said that he is aware of a petition by Anderson Township residents to require a higher bond, but said that he thought that petition had been rejected as inappropriate.
December 29th Report from the Courthouse
County Municipal Judge Fannon Rucker was presented today with a
petition from a group of Anderson Township property owners that
asks the judge to require additional security from trustee-elect Kevin
P. O'Brien "in the best interests of.taxpayers of Anderson Township. On
Monday, Judge Rucker approved a bond in the minimum amount of $1000, as
required for O'Brien to take office. The petition application
anticipates that the judge will hold a hearing to consider the request.
January 22, 2010 Report from the Courthouse
The hearing on whether or not the judge should order an increase in the amount of the bond for O'Brien in response to the citizen petition(s) has again been delayed until February 12, 2010 at the request of O'Brien's attorney, Mike Allen.
Judge Orders O'Brien's Bond Increased!!!
Rucker orders that the bond O'Brien must post to be TWENTY-FIVE TIMES
THE REQUIRED MINIMUM AMOUNT!!! Anderson citizens who petitioned the court
WIN the legal suit which benefits all Anderson Township taxpayers. This
is believed to be the first time ever in the history of the State of
Ohio that a judge ordered a trustee to post an increased bond in order
to serve in the elected position of township trustee.
April 22, 2010 Former Employer Sues O'Brien
April 22, 2010 Robert W. Baird & Company filed suit in Hamilton
County Common Pleas Court against Kevin O'Brien. You can see the filing
on the Clerk of Courts website HERE.
Court records simply note the suit is over "breach of contract."
More details on the lawsuit can be found in the article by Steve Kemme
in the local section of the April 27, 2010 (Tuesday) edition of the
Cincinnati Enquirer. A link to the article on the Cincinnati Enquirer website can be found below.
APRIL 26, 2010 - UPDATE - READ THE CINCINNATI ENQUIRER ARTICLE BY CLICKING HERE