Finra Bars Ex-UBS Broker Who Managed All-Star Pitcher’s Accounts
A former UBS Financial Services broker whose clients included baseball star Justin Verlander has accepted an industry bar after failing to disclose over a dozen private securities transactions and outside business activities with “a high net worth individual.”
Kenneth Tyrrell, a 23-year industry veteran who was discharged by UBS in August 2016, participated in 11 private securities transactions and four outside business activities without informing the firm, according to a letter of settlement issued on Friday by the Financial Industry Regulatory Authority.
The Vienna, Virginia-based broker’s failure to disclose the investments and businesses violated UBS policies and regulatory rules, the consent letter said.
Tyrrell, who accepted Finra’s bar without admitting or denying its findings, was an officer of holding companies for the customer’s outside investments and operated a company that provided “personal services” to the client, according to the consent letter. He also co-founded a company in which the client invested, it said.
The broker has served as trust protector and successor trustee for the family trust of Verlander, according to his BrokerCheck record. The pitching star, a Virginia native, earned $28 million this year as a pitcher for the World Series-winning Houston Astros.
Tyrrell, who worked for about a year at Richmond-based Cary Street Partners following his almost eight years at UBS, also is a board member of Wings for Warriors, a charity Verlander founded, according to the “other business activities” section of his BrokerCheck report.
Neither Tyrrell, nor his lawyer, Jeffrey F. Robertson of Schulte Roth & Zabel in Washington D.C., returned calls for comment.
An agent for Verlander did not return a call for comment on the pitcher’s business ties with Tyrrell.
Outside business activities and private securities transactions can “potentially involve misconduct or create conflicts of interest that may expose both firms and customers to potential risks,” Finra said in a report this week about significant issues it has uncovered in recent examinations. The self-regulatory group in August fined and suspended two former Merrill Lynch brokers for failing to tell the firm about a whiskey distillery and bar they owned.
Tyrrell transferred about $498,000 of the high net worth customer’s UBS accounts to pay for goods and services coordinated by the concierge services company that the broker’s wife founded in 2013, according to the Finra consent letter. After the customer raised questions about the company in June 2016, Tyrrell returned about $130,000, it said.
Spokespersons at UBS, which dismissed Tyrrell in September 2016, did not reply to a request for comment.
Tom Tullidge, chief strategy officer at Cary Street, which employs 47 brokers at 13 locations, said the firm felt that its decision to hire Tyrrell in August 2016 was reasonable. The broker resigned from Cary Street in September, three weeks after receiving a notice from Finra that it was likely to bring an enforcement action, according to his BrokerCheck record.
“We do an exhaustive review and try to evaluate any issues,” Tullidge said. “It was resolved differently than our original risk assessment.”