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Michael Rappa: Former Foresters Equity Advisor Barred by FINRA
A disciplinary action taken by the Financial Industry Regulatory Authority against former San Diego, California broker and investment advisor Michael Rappa (CRD# 4799159) barred him over allegations he participated in undisclosed and unapproved private securities transactions. A former representative of Foresters Equity Services, Rappa was barred from acting as a broker or otherwise associating with a broker-dealer firm.
According to a Letter of Acceptance, Waiver and Consent (No. 2018057766401) dated February 2019, solicited investors from August 2016 until July 2017 to purchase Woodbridge Group of Companies promissory notes. FINRA’s findings describe the Woodbridge Group of Companies as “a purported real estate investment fund” that filed for Chapter 11 bankruptcy in December 2017. Rappa allegedly sold 21 investors, including six customers of his member firm, Foresters Equity Services, a total of $2,731,287 in Woodbridge promissory notes. According to FINRA, he received commissions totaling $109,939 as a result of these transactions. He also allegedly did not provide his member firm with prior notice of the transactions or receive approval from the firm to participate in such. FINRA’s findings state that these activities constituted violations of FINRA Rule 3280(b), which requires associated persons to provide prior written notice detailing their role in and selling compensation they may receive from private securities transactions, and FINRA Rule 2010, which requires associated persons to observe high standards of commercial honor and just and equitable principles of trade. As a result of the foregoing alleged conduct, Rappa was barred from association with any FINRA member in any capacity.
Michael Rappa’s disclosure records also list two pending customer complaints against him. Both filed in 2018, they allege that as a representative of Foresters Equity Services, he recommended unsuitable private securities transactions. One complaint alleges damages of $75,000; the other alleges damages of $700,000.
Michael Rappa is not currently registered as a broker or investment advisor. His employment history includes Foresters Equity Services in San Diego, California, Princor Financial Services Corporation, MetLife Securities, and Metropolitan Life Insurance Company. He currently holds no state licenses and has passed four securities industry qualification examinations.