Enforcement Actions
Financial Industry Regulatory Authority (FINRA)
CASES OF NOTE
2012
NOTE: Stipulations of Fact and Consent to Penalty (SFC); Offers of Settlement (OS); and Letters of Acceptance Waiver, and Consent (AWC) are entered into by Respondents without admitting or denying the allegations, but consent is given to the described sanctions & to the entry of findings. Additionally, for AWCs, if FINRA has reason to believe a violation has occurred and the member or associated person does not dispute the violation, FINRA may prepare and request that the member or associated person execute a letter accepting a finding of violation, consenting to the imposition of sanctions, and agreeing to waive such member's or associated person's right to a hearing before a hearing panel, and any right of appeal to the National Adjudicatory Council, the SEC, and the courts, or to otherwise challenge the validity of the letter, if the letter is accepted. The letter shall describe the act or practice engaged in or omitted, the rule, regulation, or statutory provision violated, and the sanction or sanctions to be imposed.
January 2012 - View all for this month
Michael William Bozora (Principal)
AWC/2009018816501
AWC/2009018816501
As principal
of his member firm, Bozora failed to conduct adequate initial and/or
ongoing due diligence in
relation to an entity’s private placement offered and sold through
his firm.Bozora did not have a reasonable basis for believing
the recommendation of
the entity’s partners to be suitable for any of the firm’s
customers. Bozora failed to obtain
sufficient information from individuals solicited to invest in the
entity’s offering during the
relevant time period to ascertain whether a recommendation to
invest in the entity would
be suitable for them based upon their financial circumstances and
needs.
Acting through Bozora, his firm failed to maintain
subscription agreements
for investors in the entity’s private placement who invested
through the firm.
Bozora participated in the offer and sale of
limited partnership units of
an entity he co-founded. Among other things, Bozora provided
information about the entity
to other broker-dealers for the purpose of facilitating the offer
and sale of the entity by
those firms; and, in connection with this activity, he distributed,
or caused the distribution
of, a PPM that contained material misrepresentations and omitted
to disclose material
facts regarding the entity’s operations and financial condition.
The PPM failed to disclose
the foreclosure by a company, the company’s default on its
obligations to the entity and
the subsequent foreclosure by the entity on the properties that
secured those obligations.
Bozora knew, or should have known, that his entity was using new
investor proceeds in part
to pay the monthly interest obligations to the entity’s current
investors and preferred note
holders and not for new investments as represented in the entity’s
offering documents.
Bozora failed to disclose this material information to those who
invested in the entity.Bozora knew, or should have known, that his
entity lacked sufficient
revenue from operations to pay its monthly distributions to
existing investors, and was
funding such payments at least in part with capital raised from
new investors. Because new
investor funds were being applied to pay earlier investors, Bozora
did not have a reasonable
basis for believing that the recommendation to invest in the
entity’s preferred notes was
suitable for any customer.
In addition, Bozora failed to establish and
maintain a supervisory system, and to establish, maintain and
enforce WSPs reasonably
designed to cause the firm to conduct due diligence for new
offerings. Moreover,Bozora failed to supervise the activity of its registered
representatives selling his
entity’s preferred notes. Furthermore, Bozora failed to document
ongoing due diligence of
his entity and also failed to establish, maintain and enforce
procedures regarding the firm’s
due diligence review.
Michael William Bozora (Principal): Fined $50,000; Suspended 2 years
Enforcement Actions
Search in Cases of Note : FINRA
Months
Cases of Note : FINRA Archive
Tags
- AML
- Annual Compliance Meeting
- Borrowing
- Changes Of Address
- Checks
- Commissions
- Confidential Customer Information
- Due Diligence
- Elderly
- Electronic Communications
- Electronic Storage
- Embezzled
- Installment Plan Contracts
- Internet
- Life Settlement Contracts
- LOA
- Membership Agreement
- Money Laundering
- Mortgage
- OSJ
- Ponzi
- Private Placement
- Referral Fees
- Supervision
- Testing
- Unregistered Person
- Unregistered RRs
- Unregistered Securities
- Variable Annuity
- WSPs