Finra Teaches Ex-Merrill Broker a Lesson on the High Cost of College
(Updated on October 25 to include comment from Gorelik in the third and forth paragraphs.)
The Financial Industry Regulatory Authority has been stepping up its pursuit of brokers for failing to disclose tax liens and outside business interests, but old-fashioned peccadilloes such as résumé-padding can still get its attention.
The self-regulatory group on Friday fined 21-year brokerage veteran Matthew J. Gorelik $10,000 and suspended him for 18 months for falsely telling Merrill Lynch on a job application in 2013 that he graduated from a Massachusetts university in 1992 and for forging a diploma when asked to document his claim.
Gorelik, who agreed to the sanctions without admitting or denying Finra’s findings, said in an emailed statement that he spent close to $500,000 fighting the charges over two years before opting to settle.
“There comes a time where all of us have to stop the litigation process and move on, and that time has come for me,” Gorelik wrote. “Though I may disagree with some of the allegations in your article, I must respect the settlement agreement with FINRA and decline further comment. “
Finra does not specify which school Gorelik claims to have attended, but he has been liberal in citing his educational pedigree.
When he joined Jefferies & Co.’s private client services group in 2007 in Los Angeles, the firm issued a press release saying he was a graduate of Syracuse University in New York. On his LinkedIn profile, Gorelik tips his education hat to Boston’s Northeastern University, which he allegedly matriculated from in 1993.
That was the same year that he registered as broker in a career that took him to six firms, including Bear, Stearns, Smith Barney, CIBC World Markets (Oppenheimer) and JP Morgan Securities, according to Finra’s BrokerCheck database.
Finra charged him with violating Rule 2010, which requires members to “observe high standards of commercial honor.” Its settlement, published Friday on its enforcement website, says that Merrill fired him in July 2014 for, among other things, violating company policies and procedures, “including…inaccurate disclosure of educational materials.”
The action underlines a renewed push by Finra to ensure accuracy of brokers’ registration attestations, ranging from omissions about legal judgments by prominent industry members to résumé fraud.
“For long periods of time, Finra was not vigilant as to who was being registered,” said Seth Lipner, a plaintiff’s lawyer in New York. “Now they’re doing a lot more investigating.”
Gorelik now runs real-estate finance and private equity firm Township Capital in Los Angeles, and belongs to country clubs in Beverly Hills and Bloomfield Hills, Michigan, according to the firm’s website. He is not currently registered as a broker, according to Finra’s BrokerCheck database.
A spokesman for Merrill Lynch declined to comment on how the firm discovered his false claim. Gorelik began his career at Merrill Lynch in 1993, but stayed there just over a year before reapplying ten years later.