Kelly Feehrer: Ex-Merrill Lynch Rep Suspended over UIT Rollovers

Kelly Feehrer (CRD# 1470328), previously a stockbroker in Benton, Tennessee, was recently sanctioned by FINRA after findings he engaged in unsuitable trading of unit investment trusts. Formerly a representative of Merrill Lynch, he was temporarily suspended from acting as a broker.

According to a Letter of Acceptance, Waiver and Consent (No. 2018060356501) issued in June 2021, Kelly Feehrer became registered with Merrill Lynch in 1990. Starting in January 2011, FINRA’s findings state, he recommended “more than 200 of his customers” roll over their unit investment trust products more than 100 days before the products reached maturity, “on nearly 3,000 occasions.” As FINRA explains, brokers who recommend their customers sell a UIT and use the proceeds to purchase a new one generally cause their customers “to incur greater sales charges than if the customer had held the UIT until maturity.” In the case of Feehrer’s customers, the UITs generally had maturity periods of 15 or 24 months, and he recommended his clients sell them and purchase new UITs after an average holding period of 215 days. 

FINRA states further that roughly 190 of the 3,000 rollovers were “series-to-series” transactions, meaning the customers purchased “a subsequent series of the same UIT, which… generally had the same or similar investment objectives and strategies as the prior series.” His recommendations resulted in unnecessary sales charges for his customers, stated FINRA, concluding that the recommendations were unsuitable and in violation of FINRA rules. As a result, FINRA issued Mr. Feehrer a 3-month suspension from associating with any FINRA member firm in any capacity. It also ordered him to pay a fine of $5,000.

According to the Financial Industry Regulatory Authority, Kelly Feehrer holds 35 years of securities industry experience and presently is not registered as a broker or an investment adviser. His past registrations include Merrill Lynch (Benton, Tennessee; 1990-2021) and Invest Financial Corporation (Appleton, Wisconsin; 1986-1990). His credentials include the passage of five securities industry qualification examinations: the Uniform Investment Adviser Law Examination, or Series 65; the Uniform Securities Agent State Law Examination, or Series 63; the Securities Industry Essentials Examination, or SIE; the General Securities Representative Examination, or Series 7; and the General Securities Sales Supervisor Examination (Options Module & General Module), or Series 8. He presently holds no state licenses. (Information accessed on January 11, 2022.)

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