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N E W Y O R K S T O C K E X C H A H G E, I N C.
THOMAS JUNGHO YU, A FORMER REGISTERED REPRESENTATIVE
WITH MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED, ENGAGED IN CONDUCT INCONSISTENT WITH JUST
AND EQUITABLE PRINCIPLES OF TRADE IN THAT HE
MISAPPROPRIATED CUSTOMER SECURITIES -- PERMANENT SAX.
EXCHANGE HEARING PANEL DECISION 89-45
April 27, 1989
An Exchange Hearing Panel met to consider a Stipulation of
Facts ana consent to Penalty entered into between the Exchange'sDivision of Enforcement and Thomas Jungho Yu, a former registered
representative with Merrill Lynch, Pierce, Fenner & Smith
Incorporated. Without admitting or denying guilt, Yu consents to a
finding by the Hearing Panel that he engaged in conduct inconsistent
with just and equitable principles of trade in that he
misappropriated customer securities.
For the sole purpose of settling this disciplinary
proceeding, the Division of Enforcement and Yu stipulate to certain
facts, the substance of which follows:
1. Thomas Jungho Yu was born on November 27, 1961.
Yu was first employed in the securities industry by
Merrill Lynch, Pierce, Fenner & Smith Incorporated (the
"firm") on February 18, 1986. He was approved as a
registered representative on June 16, 1986. Yu was
discharged from employment with the firm on September
4, 1987. Yu is not presently employed in the
securities industry.
2. By letter dated August l, 1988, which Yu received,
the Division of Enforcement advised Yu that it was
investigating a matter which occurred while he was
employed at the firm.
3. As a firm registered representative, Yu serviced
the account of firm customer A. In August of 1987, Yuutilized the branch office computer system to change
customer A's address of record to 2636 Blackmore Street
#314, Houston, Texas. Yu's own address was #150 at the
same building address.
4. Un August 24, 1987, Yu caused a certificate representing
656 XYZ Corporation shares to be delivered out of customer
A's account to the address entered by Yu without customer
A's authorization.
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5. In September of 1987, the firm computer system
was once again entered by Yu and customer A's correct
record address was replaced.
6. The detection of the missing 650 shares of XYZ
occurred when customer A did not receive a dividend
check in October of 1987.
7. Customer A contacted the new registered representative
who assumed management of her account after Yu's discharge.
The new registered representative was advised by the
transfer agent that the address of the registered owner had
been changed to that of Yu.
8. Yu had the 650 XYZ shares transferred to his name
by forging customer A's signature to assignment and
transfer documents without her knowledge or
authorization.
9. Yu submitted a signed letter to the firm in whichhe admitted the misappropriatIon of the 650 XYZ shares,
selling a portion thereof and converting the proceeds
to 'is own use.
DECISION
The Hearing Panel, in accepting the Stipulation of Facts
and consent to Penalty, found Yu guilty as set forth above by
unanimous vote.
PENALTY
In view of the above findings, the Hearing Panel, by
unanimous vote, imposed the penalty consented to by Yu of a
permanent bar from membership, allied membership, approved person
status and from employment or association in any capacity with any
member or member organization.
For the Hearing Panel
John J. Mulcahy, Jr.Chief Hearing Officer