FINRA Bars Former Broker Jeyakumar Nadarajah for Failure to Cooperate with Investigation

The Financial Industry Regulatory Authority (FINRA) has barred former securities representative Jeyakumar Nadarajah (CRD #5666532) from associating with any FINRA member firm in all capacities after he failed to fully comply with a request for testimony during a regulatory investigation. This action highlights the importance of full cooperation with FINRA Rule 8210 requests, which require industry professionals to provide information and testimony during examinations and investigations.

Background on the Investigation

According to a Letter of Acceptance, Waiver, and Consent (AWC), FINRA’s investigation focused on certain trading practices by traders at a FINRA member firm where Nadarajah was associated. In connection with that investigation, FINRA issued an on‑the‑record (OTR) testimony request to Nadarajah pursuant to Rule 8210.

FINRA Rule 8210 authorizes FINRA to require persons under its jurisdiction to provide information and testimony related to any investigation, complaint, examination, or proceeding. Rule 2010 further requires associated persons to observe high standards of commercial honor and just and equitable principles of trade.

The Core Rule 8210 Violation

The AWC states that Nadarajah appeared for his OTR testimony and answered certain questions from FINRA staff. However, he declined to answer all of FINRA’s questions at that time, citing a pending matter.

FINRA found that by failing to provide the requested information and testimony as required under Rule 8210, Nadarajah violated both Rule 8210 and Rule 2010. FINRA treats a refusal to fully cooperate with Rule 8210 requests as a serious violation because it undermines regulators’ ability to examine potential misconduct and protect investors.

Sanction: Bar and Statutory Disqualification

As part of the AWC, Nadarajah consented to a bar from associating with any FINRA member in any capacity, including clerical or ministerial roles. The bar constitutes a statutory disqualification, meaning he may not work for a brokerage firm under FINRA’s jurisdiction while the bar is in effect.

The AWC further explains that the bar becomes effective upon FINRA’s acceptance of the agreement and will form part of Nadarajah’s permanent disciplinary record, which is available through FINRA’s public disclosure program.

What This Means for Investors

A regulatory bar is a significant disciplinary outcome, but it does not automatically compensate investors for any losses they may have suffered in connection with the underlying conduct. Investors who experienced trading losses, unsuitable recommendations, or other potential misconduct involving a broker who is later barred may still have the right to pursue claims through FINRA arbitration.

If you worked with a broker who was subsequently barred by FINRA and suffered investment losses, Sonn Law Group may be able to review your accounts, evaluate whether your losses stemmed from potential misconduct, and discuss possible recovery options.