Merrill Lynch agreed to a censure and a $150,000 fine to settle alleged violations with FINRA Enforcement. According to FINRA Enforcement, Merrill Lynch allowed an executive to function as a principal in its prime brokerage business, despite the fact that the executive was not registered with FINRA.
Morningstar Credit Ratings, LLC has agreed to pay $3.5 million to settle charges brought by the U.S. Securities and Exchange Commission (“SEC”). The SEC charged Morningstar with violating a conflict of interest rule which was designed to separate credit ratings and analysis from sales and marketing.
The Payroll Protection Program (“PPP”), designed to provide loans to small businesses, has been mired in controversy. Multiple companies, including Shake Shack, Potbelly and the Los Angeles Lakers, have repaid loans received from the PPP after public backlash. The U.S. Securities and Exchange Commission (“SEC”) has begun conducting a sweep of public companies that received loans from the PPP.
Final judgement has been entered in the federal case brought by the U.S. Securities and Exchange Commission (“SEC”) against Neil Burkholz and Frank Bianco for an alleged Ponzi scheme they ran. The SEC had already obtained a temporary restraining order and preliminary injunction against Burkholz and Bianco.
The U.S. Securities and Exchange Commission (“SEC”) filed charges against TCA Fund Management Group Corp., accusing the firm of inflating the revenue of its main fund and distributing false documents to investors and the SEC. The SEC is seeking disgorgement, a civil penalty and the appointment of a receiver to wind up the business.
The Financial Industry Regulatory Authority (“FINRA”) is projecting that its operating revenue will be approximately $868.9 million, which would be roughly equal to FINRA’s 2019 operating revenue. FINRA does expect revenue from regulatory fees to increase in 2020. Meanwhile, operating expenses are expected to increase by 2.8%. If these projections are accurate, FINRA’s expenses will exceed its operating revenue and FINRA may need to tap into its reserves, which currently sit at $210.2 million.
Western International Securities agreed to a censure and a $325,000 fine to settle alleged violations with FINRA Enforcement. According to FINRA Enforcement, Western International Securities failed to amend Forms U4 for brokers registered with the firm.
Former LPL Financial broker, Michael B. Mountjoy, agreed to a $10,000 fine and a six-month suspension from association with any FINRA member firm in all capacities. According to FINRA Enforcement, Mountjoy engaged in a private securities transaction and two outside business activities without providing his firm with prior, written notice.
Following his termination from Investacorp, Ian James sued the firm alleging that the firm engaged in deceptive and unfair trade practices, among several claims. According to James, Investacorp told him that he would be terminated “for cause” unless he sold his book of business to another representative at Investacorp. If he sold his book to the advisor selected by Investacorp, he would be allowed to resign. According to James, the price that he was offered to sell his book of business as part of this deal was far below market value.
Due to COVID-19, the CFP Certification Exam, which had been set to take place in July, has been postponed until September. The exam is now scheduled for September 22-29. Individuals who were scheduled to take the July exam will receive an email by May 31 with instructions on how to reschedule their testing appointment.
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In a significant development for investors in GPB Capital Holdings, the private equity firm will move into receivership following a prolonged legal battle.
The Securities and Exchange Commission (SEC) has charged Cantor Fitzgerald, L.P. with causing two special purpose acquisition companies (SPACs) under its control to make misleading statements to investors before their initial public offerings (IPOs).
The SEC recently charged Ken Leech, former Co-CIO of Western Asset Management, with fraud.
