Financial Enforcement Actions | Week of Aug 01 to Aug 07

Enforcement Report Aug 01 - 07

Enforcement Report Aug 01 - 07

FTC

5 Enforcement Documents

$0.00 in Fines

Penalties: N/A
Respondent: American Screening, LLC, a Louisiana limited liability company; Ron Kilgarlin Jr., individually and as an officer of American Screening, LLC; and Shawn Kilgarlin, individually and as an officer of American Screening, LLC
Violation: Wherefore, Plaintiff FTC, pursuant to Sections 13(b) and 19 of the FTC Act, 15 U.S.C. §§ 53(b), 57b, MITOR, and the Court’s own equitable powers, requests that the Court: A... Read More

Penalties: N/A
Respondent: QYK BRANDS LLC d/b/a Glowyy, DRJSNATURAL LLC, RAKESH TAMMABATTULA, individually and as an officer of QYK BRANDS LLC, and JACQUELINE THAO NGUYEN, individually and as an officer of QYK BRANDS LLC and DRJSNATURAL LLC
Violation: Section 19 of the FTC Act, 15 U.S.C. § 57b, and MITOR authorize this Court to grant such relief as the Court finds necessary to redress injury to consumers resulting from Defendants’ violations of MITOR, including the rescission or reformation of contracts and the refund of money... Read More

Penalties: N/A
Respondent: ZAAPPAAZ LLC, also d/b/a Wrist-Band.com, WBpromotion.com, CustomLanyard.net, and WB Promotions; and AZIM MAKANOJIYA, individually and as an officer of ZAAPPAAZ LLC,
Violation: Wherefore, Plaintiff FTC, pursuant to Sections 13(b) and 19 of the FTC Act, 15 U.S.C. §§ 53(b) and 57b, MITOR, 16 C.F.R. Part 435, and the Court’s own equitable powers, requests that the Court: A. Award Plaintiff such preliminary injunctive and ancillary relief as may be necessary to avert the likelihood of consumer injury during the pendency of this action and to preserve the possibility of effective final relief, including but not limited to, temporary and preliminary injunctions... Read More

Penalties: N/A
Respondent: YELLOWSTONE CAPITAL LLC, a New York limited liability company, FUNDRY LLC, a New York limited liability company, YITZHAK D. STERN, a/k/a Isaac Stern, individually and as an officer of Yellowstone Capital LLC and Fundry LLC, and JEFFREY REECE, individually and as an officer of Yellowstone Capital LLC and Fundry LLC,
Violation: In truth and in fact, in numerous instances in which Defendants have made the representations set forth in Paragraph 41, such representations were false or misleading at the time Defendants made them... Read More

Penalties: N/A
Respondent: Yellowstone Capital LLC, FTC
Violation: N/A... Read More

FINRA

11 Enforcement Documents

$72,500.00 in Fines

Penalties: $5,000.00
Respondent: Steven Michael Voce
Violation: Between December 2014 and September 2016, Voce willfully failed to amend his Uniform Application for Securities Industry Registration or Transfer (Form U4) to disclose three tax liens totaling approximately $300,000, in violation of Article V, Section 2(c) of FINRA's By-Laws and FINRA Rules 1122 and 2010... Read More

Penalties: N/A
Respondent: Kimberly Ann Barentsen
Violation: Between January 2017 and January 2019, Barentsen exceeded the scope of her approved outside investment advisory business by charging asset-management fees. As a result, Barentsen violated FINRA Rules 3270 and 2010... Read More

Penalties: $10,000.00
Respondent: Sylvester Knox
Violation: From June 2015 through October 2016, Knox violated FINRA Rule 2010 when he effected 36 transactions with a total principal value of approximately $1.7 million in three of his Firm customers’ accounts without the customers’ authorization or consent for the trades. During the same period, Knox also violated NASD Rule 2510(b) and FINRA Rule 2010 when he exercised discretionary trading authority and effected 36 transactions with a total principal value of approximately $2 million in the accounts of four of his Firm customers without having obtained prior written authorization from the customers or approval from Merrill Lynch to treat the accounts as discretionary... Read More

Penalties: $7,500.00
Respondent: Serge Parakhnevich
Violation: From September 21, 2017 through July 16, 2019, Parakhnevich executed at least 96 trades in a customer account without the customer's prior written authorization or the firm's approval of the account as discretionary, in violation of NASD Rule 2510(b) and FIN RA Rules 3260(b) and 2010... Read More

Penalties: $10,000.00
Respondent: Omar Waleed Hammad-Randolph
Violation: In July 2015, Randolph borrowed $150,000 from his customer at Merrill Lynch without disclosing the loan to, and obtaining approval to engage in the loan transaction from, his firm... Read More

Penalties: $25,000.00
Respondent: Corecap Investments, LLC
Violation: FINRA Rule 2010 requires each FINRA member firm, in the conduct of its business, to observe just and equitable principles of trade. A violation of a FINRA, NASD, or Exchange Act rule is also violation of FINRA Rule 2010... Read More

Penalties: $5,000.00
Respondent: Shaun C. Simmons
Violation: On two separate occasions in September 2019, while he was associated with TIAA, Simmons forged the signatures of two TIAA customers on multiple forms related to an IRA rollover, in violation of FINRA Rules 2010 and 4511 and 2010... Read More

Penalties: N/A
Respondent: Victor A. Rigoni, III
Violation: Rigoni falsely attested to Summit Brokerage Services, Inc., his employing member firm, on six annual firm compliance questionnaires between 2012 and 2017 that he was in compliance with FINRA’s Form U4 disclosure requirements... Read More

Penalties: $5,000.00
Respondent: John Pace McConkie
Violation: Over an eleven-month period, McConkie electronically signed at least six account applications and one brokerage-to-advisory change form on behalf of a colleague without the colleague's knowledge, thereby violating FINRA Rule 2010... Read More

Penalties: $5,000.00
Respondent: Frederick Scott Levine
Violation: Between July 1, 2011 and November 17, 2014 (the "Relevant Period"), Levine engaged in an unsuitable pattern of short-term trading of Unit Investment Trusts in customer accounts... Read More

SEC

14 Enforcement Documents

$522,996,630.00 in Fines

Penalties: $350,000.00
Respondent: RIALTO CAPITAL MANAGEMENT, LLC,
Violation: Section 206(4) of the Advisers Act and Rule 206(4)-8 thereunder make it unlawful for any investment adviser to a pooled investment vehicle to “[m]ake any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in the light of the circumstances under which they were made, not misleading, to any investor or prospective investor in the pooled investment vehicle” or to “engage in any act, practice or course of business that is fraudulent, deceptive, or manipulative with respect to any investor or prospective investor in the pooled investment vehicle... Read More

Penalties: $500,000,000.00
Respondent: Wells Fargo & Company
Violation: According to the Order, Wells Fargo, among other things, failed to disclose to investors that the Community Bank’s sales model had caused widespread unlawful and unethical sales practices misconduct that was at odds with its investor disclosures regarding needs-based selling, and that the publicly reported cross-sell metric included significant numbers of unused or unauthorized accounts... Read More

Penalties: $21,726,000.00
Respondent: World Acceptance Corporation
Violation: As a result of the conduct described above related to payments to government officials and union officials, WAC violated Section 13(b)(2)(B) of the Exchange Act which requires every issuer with a class of securities registered pursuant to Exchange Act Section 12 to devise and maintain a system of internal accounting controls sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary (I) to permit preparation of financial statements in conformity with generally accepted accounting principles or any other criteria applicable to such statements, and (II) to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences... Read More

Penalties: N/A
Respondent: Jack Brewer
Violation: According to the SEC's complaint, Brewer, a former registered representative, was the owner and control person of both a registered investment adviser, Brewer Capital Management (BCM), and a related consulting firm, Brewer Group Inc. Brewer consulted for COPsync, where he obtained material, nonpublic information about COPsync's plans to do a stock offering. According to the complaint, Brewer participated in the offering, and the purchase agreement contained a clause obligating him not to sell any shares of the company prior to the announcement of the offering... Read More

Penalties: N/A
Respondent: Randolph Acquisitions, Inc.,
Violation: As discussed in more detail above, the Respondent is delinquent in its periodic filings with the Commission, has repeatedly failed to meet its obligation to file timely periodic reports, and failed to heed a delinquency letter sent to it by the Division of Corporation Finance requesting compliance with its periodic filing obligations or, through its failure to maintain a valid address on file with the Commission as required by Commission rules, did not receive such letter... Read More

Penalties: N/A
Respondent: Niel Martin Nielson
Violation: The judgment, entered on the basis of default, determined that Nielson violated, and permanently enjoins him from violating, the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, the books and records provisions of Section 13(b)(5) of the Exchange Act and Rules 13b2-1 and 13b2-2 thereunder, the certification provision of Rule 13a-14 of the Exchange Act, and the ownership reporting provision of 16(a) of the Exchange Act and Rule 16a-3 thereunder... Read More

Penalties: $750,000.00
Respondent: WBI Investments, Inc. and Millington Securities, Inc.,
Violation: WBI and Millington also assured the boards of their ETF and mutual fund clients that the payment for order flow arrangements did not adversely affect execution prices, and that the costs of these arrangements were absorbed by the Executing Brokers... Read More

Penalties: $170,630.00
Respondent: NIEL MARTIN NIELSON
Violation: Defendant is permanently enjoined from committing future violations of the federal securities laws and regulations identified in the R. & R., and that Defendant is enjoined for a period of ten years, starting on the date of this Court’s order, from (1) serving as an officer or director of a public company, (2) participating in a penny-stock offering, and (3) directly or indirectly accepting compensation for consulting or advising any penny-stock issuer... Read More

Penalties: N/A
Respondent: Victor Lee Farias and Integrity Aviation & Leasing, LLC
Violation: According to the complaint, many of the investors were retirees who, in order to invest their retirement funds, had to withdraw the funds from their retirement accounts and deposit them in newly created self-directed IRA accounts... Read More

Penalties: N/A
Respondent: Tommy Shek, CPA
Violation: On July 12, 2018, Tommy Shek, CPA (“Shek”) was denied the privilege of appearing or practicing before the Commission as an accountant as a result of settled public administrative proceedings instituted by the Commission against him pursuant to Rule 102(e)(1)(ii) of the Commission’s Rules of Practice... Read More

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