Kevin Cory Barred by FINRA Over Alleged Misleading Communications

Kevin Cory (CRD #: 1716966), a broker formerly registered with R. F. Lafferty & Company, was barred by FINRA, according to his BrokerCheck record, accessed on June 12, 2023. Read on to learn more about his alleged conduct as a broker.

Bar by FINRA

On May 26, 2023, Kevin Cory consented to the entry of sanctions that he allegedly misrepresented and omitted material facts in communications with former clients between November 2018 and August 2020.

Former Clients’ Alleged Investments in Fund

According to a Letter of Acceptance, Waiver & Consent (AWC), two married former clients of Kevin Cory allegedly invested $500,000 of their retirement funds in a purported investment fund (the Fund) which he had allegedly formed and was managing.

Kevin Cory allegedly invested these clients’ funds to make loans to small businesses rather than investing in global equity securities, as stated in the Fund’s Offering Memorandum. Some of these businesses were allegedly owned by Kevin Cory or managed by his friends and associates.

The AWC alleged that, by the end of 2016, these businesses had defaulted on their loans, the Fund had no assets, and its corporate registrations had been canceled for failure to pay taxes.

Allegations of Misrepresentations and Omissions

Between November 2018 and July 2019, Kevin Cory allegedly created and sent these clients two fictitious account statements that misrepresented their investment in the Fund as having risen in value.

Further, Kevin Cory allegedly misrepresented and omitted material facts to these clients between November 2018 and August 2020. In 14 text messages, he allegedly made misrepresentations relating to the value of the clients’ investment in the Fund, the nature of its loans to small businesses, and his collection efforts on the now-overdue loans.

He allegedly also omitted the fact that the Fund had no assets and no longer existed as a corporate entity.

The AWC concluded that these allegations violated FINRA Rules 2210 and 2010.

FINRA Rule 2210

FINRA Rule 2210 defines how firms and brokers are permitted to communicate with the public (e.g., in advertising). This rule requires all communications with the public to be fair and balanced and free from any false or misleading statements.

FINRA Rule 2010

FINRA Rule 2010 holds brokers to high standards of commercial honor and just and equitable principles of trade.

Sanctions

On May 26, 2023, Kevin Cory was permanently barred by FINRA.

You can read the full AWC here.

Investor Dispute

On October 4, 2021, several investors filed a dispute alleging that Kevin Cory approached them to invest their retirement savings in a limited partnership he established without his firm’s approval.

The clients further alleged that he used their funds to pay for his personal living expenses instead of investing them and ceased all communications with them in August 2019. They sought $500,000 in damages and received a settlement of $250,000.

FINRA Rule 3270

FINRA Rule 3270 requires brokers to disclose any business activities they engage in outside their firm, as well as any compensation they may receive from these activities.

Background Information

Kevin Cory has passed the following exams:

• Series 63 – Uniform Securities Agent State Law Examination
• Series 66 – Uniform Combined State Law Examination
• SIE – Securities Industry Essentials Examination
• Series 7 – General Securities Representative Examination

He previously worked for the following firms:

• R. F. Lafferty & Company (CRD#:2498)
• Chapin, Davis (CRD#:28116)
• DB Alex. Brown (CRD#:17790)
• Ferris, Baker Watts (CRD#:285)

Kurta Law Can Help

If you worked with Kevin Cory and you have concerns about your investments, please contact us today at 877-600-0098 or info@kurtalawfirm.com for a free consultation.

For over 20 years, Kurta Law has advocated on behalf of investors who want to recover their investment losses from brokers and brokerage firms. Kurta Law is a nationally recognized law firm and exclusively represents investors against brokers and brokerage firms on a contingency basis. This means that the firm only earns a fee if our securities attorneys recover money on your behalf.