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Donald Logan Fined $25k for Unauthorized Discretionary Trades, Having Customers Sign Blank Documents

FINRA fined and suspended former Edward Jones and Waddell & Reed broker Donald Logan for exercising 365 discretionary trades in 42 customer accounts from 2014 through 2018, all without authorization. In comments to Citywire, Logan accused both Edward Jones and Waddell & Reed of failing to adhere to a FINRA regulation (NASD Rule 2510(b)) that requires written authorization for discretionary accounts.

The findings state that Logan (CRD #5537486), whose broker registration history includes two firms—Edward Jones and Waddell & Reed, both of Silverdale, Washington—also executed 11 unauthorized transactions in three accounts at Edward Jones, in addition to the unauthorized use of discretion effected at both firms.

According to the report, Waddell & Reed additionally hadn't approved the customer accounts for discretionary trading and Logan told Citywire that "no client ever had to give written permission or authority to execute a trade. It was always verbal."

This statement is seemingly at odds with FINRA rules (NASD Rule 2510(b) explicitly states that discretionary trading requires written authorization from the customer) and many firms' policies that require prior written authorization and firm acceptance of an account as discretionary.

Speaking to Citywire, Logan alleged that both Edward Jones and Waddell & Reed ran afoul of this industry rule: "If you tell me your understanding is that a client is supposed to submit written authorization, I've never heard that in 10 years and I know that does not happen at Edward Jones or Waddell & Reed."

FINRA also charged Logan with having several Waddell & Reed customers sign blank or incomplete forms, including account transfer and rollover documents, in violation of firm policy that prohibits brokers from having clients sign blank or incomplete forms.

According to his file, Logan settled a customer dispute over universal life insurance premiums in 2015. Also in 2015, Edward Jones discharged Logan for violating the firm's policy regarding discretionary orders, while in 2018, Waddell & Reed terminated Logan for possessing multiple blank client-signed forms and altered client-signed documents.

If you have invested with ex-Edward Jones and Waddell & Reed broker Donald Logan or with any financial adviser who has improperly exercised discretion in your accounts without written authorization or who has prompted you to sign blank forms, leading to damages in your accounts or other harm to your investments, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.

The Law Offices of Jonathan W. Evans & Associates - California Securities Fraud Attorney
Located at 12711 Ventura Boulevard, Suite #440 Studio City, CA 91604. View Map
Phone: (800) 699-1881 | Local Phone: (818) 760-9880.