Bentley Edward Blackmon, Formerly of Stephens, Suspended Following Allegations of Participation in Private Securities Transactions Without Notice

INVESTORS: Former Stephens broker Bentley Edward Blackmon was suspended by FINRA following allegations that he participated in private securities transactions without providing notice.

Bentley Edward Blackmon (CRD: 2627221) was registered as a broker with Stephens from 2003 until 2020. Previously, Blackmon was registered as a broker with Morgan Stanley from 1995 until 2003.

Blackmon has three disclosures on his BrokerCheck report. One customer dispute filed against Blackmon was denied.

March 2022 Regulatory Judgment

Status: Final

Initiated By: FINRA

Allegations: Without admitting or denying the findings, Blackmon consented to the sanctions and to the entry of findings that he participated in private securities transactions without providing prior written notice to his member firm. The findings stated that Blackmon introduced a customer of the firm to the issuer of a private placement offering and informed the customer that he intended to invest in the offering himself. Blackmon also participated in a telephone conference with the customer and the issuer about the offering. Blackmon coordinated a wire transfer payment from the customer’s account at the firm to facilitate the customer’s initial investment of $195,000 in the offering. Later, after making an investment for himself, Blackmon disclosed his own investment in the offering to the firm. However, Blackmon did not disclose to the firm that he had also participated in the customer’s investment. Subsequently, Blackmon facilitated two additional wire transfer payments from the customer’s account at the firm for the customer’s additional investments in the offering, totaling approximately $250,000. Blackmon did not receive any commissions from the sale of the securities.

Resolution: Acceptance, Waiver & Consent (AWC)

Sanctions: Civil and Administrative Penalty(ies)/Fine(s)

Amount: $5,000.00

Sanctions: Suspension

Registration Capacities Affected: All Capacities

Duration: Three months

Start Date: 3/21/2022

End Date: 6/20/2022

Broker Comment: At the time of the transactions at issue described in the Letter of Acceptance, Waiver, and Consent (“AWC”) Matter No. 2020068226001, Mr. Bentley Blackmon was working as a registered agent at a FINRA registered brokerage firm (the “brokerage firm”). As discussed in the AWC, a customer (the “Customer”) of Mr. Blackmon’s former brokerage firm engaged in a private securities transaction. Mr. Blackmon had worked with this Customer for over a decade and they had developed a close professional friendship. All of the transactions and the wire transfers related to these private securities transaction were initiated with the full authorization and direction from the Customer and facilitated through his brokerage account at Mr. Blackmon’s previous brokerage firm. No funds came from any private accounts of this Customer. As such, Mr. Blackmon’s previous brokerage firm had full visibility and access to the information related to the Customers payments. Respondent initiated the transactions at the exclusive direction of and with the specific authorization of this Customer. Additionally, the Customer was and is a sophisticated customer with a longstanding relationship with both Mr. Blackmon and the brokerage firm, as mentioned. The Customer was and is an accredited investor with a high-degree of knowledge and sophistication related to the private placement market and related securities offerings in the private placement market. The Customer had participated in numerous other private placements outside of Mr. Blackmon’s previous brokerage firm and was an investor in private placement offerings for at least ten years prior to the at issue transaction. Mr. Blackmon disclosed to the Customer that they were not offering these investments through his previous brokerage firm, and that he could not provide investment advice related to these offerings. Moreover, Mr. Blackmon was never compensated in any way for these investments. Finally, Mr. Blackmon did in fact provide his previous brokerage firm notice of his own investment in the transaction. A brief background of the circumstances surrounding timing is important for consideration and context. The at issue transaction occurred in the spring of 2020 right at the height of the Covid-19 pandemic when Mr. Blackmon’s prior brokerage firm shifted its entire workforce to remote working to attempt to best manage the quarantining related to the pandemic during those strenuous times. As such, Mr. Blackmon’s former brokerage firm was forced, just like all companies and firms in this country at that time, to attempt to best manage the conversion to a remote workforce in an expedited timeframe. As such, for a brokerage firm that was still working almost exclusively in hard copy documentation for its supervision and compliance process, the changeover to electronic means took a period of adjustment. These circumstances contributed to the late notification by Mr. Blackmon of his own transaction. While Mr. Blackmon acknowledges that he did submit the notification for his own transaction late, he ultimately did submit this necessary documentation to his former brokerage firm. The reasons for the late submission relate to the pandemic and the new remote work environment at that time.

September 2020 Employment Separation After Allegations

Firm Name: Stephens, Inc.

Termination Type: Discharged

Allegations: The Firm determined employee violated FINRA Rule 3280 and Firm policies as part of his participation in certain private securities transactions.

Broker Comment: At the time of the transactions at issue described in the Letter of Acceptance, Waiver, and Consent (“AWC”) Matter No. 2020068226001, Mr. Bentley Blackmon was working as a registered agent at a FINRA registered brokerage firm (the “brokerage firm”). As discussed in the AWC, a customer (the “Customer”) of Mr. Blackmon’s former brokerage firm engaged in a private securities transaction. Mr. Blackmon had worked with this Customer for over a decade and they had developed a close professional friendship. All of the transactions and the wire transfers related to these private securities transaction were initiated with the full authorization and direction from the Customer and facilitated through his brokerage account at Mr. Blackmon’s previous brokerage firm. No funds came from any private accounts of this Customer. As such, Mr. Blackmon’s previous brokerage firm had full visibility and access to the information related to the Customers payments. Respondent initiated the transactions at the exclusive direction of and with the specific authorization of this Customer. Additionally, the Customer was and is a sophisticated customer with a longstanding relationship with both Mr. Blackmon and the brokerage firm, as mentioned. The Customer was and is an accredited investor with a high-degree of knowledge and sophistication related to the private placement market and related securities offerings in the private placement market. The Customer had participated in numerous other private placements outside of Mr. Blackmon’s previous brokerage firm and was an investor in private placement offerings for at least ten years prior to the at issue transaction. Mr. Blackmon disclosed to the Customer that they were not offering these investments through his previous brokerage firm, and that he could not provide investment advice related to these offerings. Moreover, Mr. Blackmon was never compensated in any way for these investments. Finally, Mr. Blackmon did in fact provide his previous brokerage firm notice of his own investment in the transaction. A brief background of the circumstances surrounding timing is important for consideration and context. The at issue transaction occurred in the spring of 2020 right at the height of the Covid-19 pandemic when Mr. Blackmon’s prior brokerage firm shifted its entire workforce to remote working to attempt to best manage the quarantining related to the pandemic during those strenuous times. As such, Mr. Blackmon’s former brokerage firm was forced, just like all companies and firms in this country at that time, to attempt to best manage the conversion to a remote workforce in an expedited timeframe. As such, for a brokerage firm that was still working almost exclusively in hard copy documentation for its supervision and compliance process, the changeover to electronic means took a period of adjustment. These circumstances contributed to the late notification by Mr. Blackmon of his own transaction. While Mr. Blackmon acknowledges that he did submit the notification for his own transaction late, he ultimately did submit this necessary documentation to his former brokerage firm. The reasons for the late submission relate to the pandemic and the new remote work environment at that time.

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