The allegations read: Diaz was named a respondent in a finra complaint alleging that he did not have a reasonable basis for recommending that customers make variable annuity exchanges. The complaint alleges that diaz failed to make an individualized assessment of the advantages and disadvantages of the recommended exchanges and failed to understand the features of the variable annuity product. The complaint also alleges that diaz falsified or caused the falsification of the reported net worth of customers in order to make it appear that they satisfied the minimum net worth requirements for certain alternative investments or the prohibitions against investing more than 10 percent of a customer's assets into a single illiquid product. Diaz misled or attempted to mislead his member firms and the alternative investment product issuers to believe that these customers were eligible to purchases the investments under the terms established, when in fact they were not. Diaz attempted to induce an insurance company to transfer a customer's variable annuity to his control by altering or causing the alteration of the signature date on a transfer authorization form. The complaint further alleges that diaz intentionally or recklessly made untrue statements of material fact by falsely telling five customers that one or more of the alternative investments were guaranteed to pay a specific rate of return and telling two customers that the investments were guaranteed. This conduct violated section 10(b) of the securities exchange act of 1934 and rule 10b-5 thereunder, nasd rule 2120 and finra rule 2020. In addition, the complaint alleges that diaz falsified his firm's books and records by creating variable annuity switch forms with false reasons for the exchanges. Diaz falsified or caused the use of falsification of net worth, income, assets, and/or risk tolerance information for nine customers, and forged the signature of one customer. Moreover, the complaint alleges that diaz made unauthorized trades in the accounts of customers. Furthermore, the complaint alleges that diaz, fired from four firms, routinely engaged in efforts to mislead his customers into believing that he had left firms voluntarily, both through affirmative statements and through his response to questions about the circumstances under which he left the firms.
