INVESTORS: Former Morgan Stanley broker Nikolay Zotenko was suspended by FINRA for providing misleading and unwarranted statements to investors about a private placement.
Nikolay Zotenko (CRD#: 6334022) was registered as a broker with Morgan Stanley from 2015 until 2021. Zotenko does not have any other securities industry experience.
Zotenko has two disclosures on his BrokerCheck report.
May 2022 Regulatory Judgment
Initiated By: FINRA
Allegations: Without admitting or denying the findings, Zotenko consented to the sanctions and to the entry of findings that he sent emails describing an investment opportunity through his firm email account to over 600 prospective customers, without submitting the content of these retail communications approval from his member firm. The findings stated that the communications violated the content standards for member communications with the public because they contained statements that were misleading and unwarranted. In addition, the communications lacked balance and failed to provide a sound basis to evaluate the private placement investment. After sending the communications without firm approval, Zotenko submitted the content of the communications for approval by the firm. The content of the communications he submitted for approval was substantively the same as the communications he had already sent. The firm denied approval of the communications and informed Zotenko that the content of the communications contained several issues, including impermissible promissory statements. Despite the firm’s denial, Zotenko sent the communications using the firm’s internal system to approximately 550 additional prospective customers. In order to circumvent the system’s restrictions on unapproved communications, Zotenko falsely affirmed in the firm’s system that he did not intend to send the campaign to more than 25 recipients. However, Zotenko sent the communications in multiple separate batches to 25 recipients at a time – each time falsely indicating that the messages were intended for no more than 25 recipients. The communications also indicated that Zotenko’s colleague was the sender notwithstanding that Zotenko sent all of the emails through the firm’s system. Zotenko obtained his colleague’s permission to send the emails using his name, but the colleague was not aware Zotenko entered false information into the firm’s system or that the firm had previously denied approval of the proposed content of the communications.
Resolution: Acceptance, Waiver & Consent (AWC)
Sanctions: Civil and Administrative Penalty(ies)/Fine(s)
Registration Capacities Affected: All Capacities
Duration: One Year
Start Date: 5/16/2022
End Date: 5/15/2023
April 2021 Employment Separation After Allegations
Firm Name: Morgan Stanley Smith Barney, LLC
Termination Type: Discharged
Allegations: Concerns that the representative sent email to many client prospects with content about an investment opportunity, after he had sought approval for the content of the email and not received it, and took steps to avoid further review of the email by the Firm.
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