State Farm reps fined for ducking tests

Registered reps who were supervisors directed subordinates to take State Farm's proficiency test for them.

The Financial Industry Regulatory Authority has fined and suspended 16 current and former registered representatives of State Farm VP Management Corp. for misconduct involving Finra’s continuing education requirements for registered representatives.
The representatives received fines ranging from $5,000 or $10,000 and received suspensions ranging from 30 days to six months.
Nine of the sanctioned registered reps were supervisors who directed or allowed subordinates to take State Farm’s “Firm Element” proficiency test for them.
One rep was a supervisor who directed a subordinate to take the test for other reps.
Six of the sanctioned reps completed the test for their superiors.
State Farm, which administers the test on an internal, computer-based system, requires reps to complete a two-hour training session and then pass a proficiency test with a minimum score of 80%.
Each of the registered reps consented to Finra’s findings without admitting or denying the charges.
The representatives engaged in the misconduct without any authorization from State Farm, according to Finra.
State Farm of Bloomington, Ill. reported the misconduct to Finra after uncovering test-taking irregularities in one of its regions and conducting a preliminary investigation.
A study conducted last May by Vestment Advisors Inc., a Shorewood, Minn.-based consulting and training firm for the financial services industry, found that nearly 20% said they knew of someone who knowingly had violated compliance rules and regulations.