FINRA Sanctions Another Former LPL Financial Broker for Borrowing Money from Clients

James Edward Bashaw (CRD# 1251491), is a broker and investment advisor previously registered with LPL Financial in Houston, Texas.

Following an investigation, Bashaw was suspended and fined by FINRA for borrowing money from one of LPL’s customers, violating firm policy.

Throughout 2013, Bashaw allegedly borrowed a total of $200,000 from one of LPL’s clients who also happened to be one of Bashaw’s long-time friends (Letter of Acceptance, Waiver and Consent No. 2014042876501). Bashaw then lied about the loans on LPL’s annual compliance questionnaire.

LPL’s written supervisory procedures prohibited borrowing money from a customer unless that customer was a family member. Further, FINRA Rule 3240 generally requires a registered representative to notify the firm and obtain written pre-approval of a borrowing arrangement with a customer.

Bashaw did not make any repayment on the loans, which he disclosed as “personal loans” when he filed for Chapter 11 bankruptcy in December 2017. Without admitting or denying FINRA’s finding, Bashaw agreed to a four-month suspension, a $5,000 fine, and to requalify as a General Securities Representative before acting with any FINRA member.

According to BrokerCheck, Bashaw remains registered with International Asset Advisory, which he joined in 2014 after being discharged by LPL. Bashaw is the second LPL broker sanctioned by FINRA for receiving loans from a client.

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