Benjamin Edwards Settles Enforcement Action

On November 13, 2020, Benjamin Edwards settled an enforcement action whereby he failed reasonably to supervise certain of its representatives who made unsuitable recommendations to its retail brokerage customers and advisory clients that they buy and hold for extended periods two complex exchange traded products that were intended for short-term holding (the “Complex ETPs”). These … Read More

Royal Alliance Settle Charges

On November 13, 2020, Royal Alliance agreed to settle charges that it failed to adopt and implement policies and procedures reasonably designed to prevent unsuitable investments in volatility-linked exchange-traded products (“ETPs”). As a result, Royal Alliance IARs used their discretionary authority over client accounts to buy and hold a complex ETP for time periods that … Read More

American Portfolios Financial Services and American Portfolios Advisors Settle Charges

On November 13 2020, American Portfolios Financial Services and American Portfolios Advisors settled charges that it recommended and advised customers buy and hold a complex exchange-traded product (“ETP”) without a reasonable basis for believing the recommendation was suitable for their customers. Those customers lost significant portions of their investment. The representatives did not understand the … Read More

Charges Settled by Securities America Advisors, Inc.

On November 13 2020, Securities America Advisors, Inc., q wholly owned subsidiary of Ladenburg Thalmann Financial Services Inc., agreed to settled charges that it failed to adopt and implement policies and procedures reasonably designed to prevent investments in two volatility-linked exchange-traded products (“ETPs”) that were not suitable for SAA clients. SAA, among other things, failed … Read More

Summit Financial Group, Inc. Settles Charges

On November 13, 2020, Summit Financial Group, Inc. settled charges that it failed to adopt and implement policies and procedures reasonably designed to prevent unsuitable investments in volatility-linked exchange traded products (“ETPs”). As a result, Summit’s IARs recommended to their clients that they purchase and hold one of the ETPs for durations that were inconsistent … Read More

Former Chairman and CEO of Wells Fargo & Company Settles Charges

On November 13, 2020, John Stumpf, the former Chairman and Chief Executive Officer of Wells Fargo & Company, settled charges that he signed and certified misleading statements to the investing public that misstated a key performance metric. Stumpf and Wells Fargo publicly stated on numerous occasions that a core business strategy for the company, including … Read More

OCIE issued a Risk Alert

On November 9, 2020, the Office of Compliance, Inspections and Examinations (OCIE) issued a Risk Alert in connection with observations from OCIE’s examinations of investment advisers: supervision, compliance and multiple branch offices. OCIE conducted a series of examinations that focused on SEC-registered investment advisers operating from numerous branch offices and with operations geographically dispersed from … Read More

Capitol Securities Management, Inc. Settles Charges

On November 5, 2020, Capitol Securities Management, Inc. settled charges in connection with its mutual fund share class selection practices and its receipt of fees pursuant to Rule 12b-1 under the Investment Company Act of 1940 (“12b-1 fees”). At times during the period from January 1, 2014 through December 31, 2016 (the “Relevant Period”), CSM … Read More

Conrad Coggeshall Settles Charges

On November 5, 2020, Conrad Coggeshall settled charges that he defrauded elderly investors in a company he called BOTR, LLC. According to the complaint, Coggeshall made multiple misrepresentations to investors, including that they were investing in BOTR, LLC, a successful mergers and acquisition firm based in New York, their investments were safe and insured, and … Read More

SEC’s Division of Enforcement Published 2020 Annual Report

On November 2, 2020, the SEC’s Division of Enforcement published its annual report for fiscal year 2020.  In fiscal year 2020, the SEC brought a diverse mix of 715 enforcement actions, including 405 “standalone actions”.   72% of standalone actions included charges against one or more individuals.  Over 20% of all enforcement actions were against investment … Read More