The Wall Street Legal & Regulatory Feed
Securities Industry Commentator by Bill Singer Esq
October 3, 2019
featured in today's Securities Industry Commentator:
FINRA Fines UBS Financial Services Inc. $2 Million for Continued Failures Relating to Short Positions in Municipal Securities / Firm Inaccurately Represented the Tax Status of Thousands of Interest Payments to Customers; Restitution Ordered (FINRA Release)
https://www.finra.org/media-center/newsreleases/2019/finra-fines-ubs-financial-services-inc-2-million-continued-failures
For the purpose of proposing a settlement of rule violations alleged by the Financial Industry Regulatory Authority ("FINRA"), without admitting or denying the findings, prior to a regulatory hearing, and without an adjudication of any issue,UBS Financial Services Inc submitted a Letter of Acceptance, Waiver and Consent ("AWC"), which FINRA accepted. In the Matter of UBS Financial Services Inc, Respondent (FINRA AWC 2016050874301)
https://www.finra.org/sites/default/files/2019-10/ubs-awc-100219.pdf
In accordance with the terms of the AWC, FINRA imposed upon UBS a Censure, $2,000,000 fine; and an undertaking to make restitution. As alleged in part in the FINRA Release:
FINRA found that from August 2015, when FINRA previously sanctioned UBS for similar violations, through the end of 2017, UBS continued to fail to timely identify and properly address certain short positions in municipal securities. As a result, UBS inaccurately represented on customer account statements and Forms 1099 that interest payments for 2,853 positions in municipal securities were tax-exempt when, in fact, they were taxable, and inaccurately represented on approximately 950 additional customer account statements and Forms 1099 that interest payments were taxable, when they were tax-exempt. FINRA found that these failures were the result of the firm's continued failure to establish reasonably designed supervisory systems and written supervisory procedures to timely identify short positions in municipal securities and its failure to provide reasonable guidance to its registered representatives instructing them how to address the short positions.
From July 2009 through December 2013 (the "relevant period"), UBS failed to reasonably supervise and to have an adequate supervisory system, including adequate written supervisory procedures, to address short positions in tax-exempt municipal bonds that resulted primarily from trading errors at the Firm's retail branches. As a result of these supervisory failures, UBS inaccurately represented to approximately 4,371 customers that at least $1,165,000 in interest that the Firm paid to those customers was exempt from taxation. In fact, the Firm did not hold the bonds on behalf of the customers and the interest that the customers received was paid by UBS and thus taxable as ordinary income, The Firm failed to consider -- and its automated system that calculated the interest owed to customers did not take into account -- whether the interest it paid to customers should be coded as non-taxable when the interest was paid by the Firm rather than the municipal issuer. UBS's failure to have adequate systems and procedures to address instances in which it became short municipal bonds violated MSRB Rule G-27. The Firm's misstatements to customers regarding the tax-exempt status of interest payments violated MSRB Rules G-17 and G-8. And, its failure to maintain a record of the customers to whom its municipal short positions were allocated violated MSRB Rule G-8.
And the big difference between the misconduct cited in UBS' 2015 and 2019 AWC is just what exactly? The firm is still making misstatements to its customers about the tax-exempt status of interest payments.
You can argue with me all you want. You can accuse me of splitting hairs. On the other hand, before you attack me, please carefully consider this language from the 2019 AWC:
FINRA found that from August 2015, when FINRA previously sanctioned UBS for similar violations, through the end of 2017, UBS continued to fail to timely identify and properly address certain short positions in municipal securities.
When . . . FINRA . . . previously . . . sanctioned . . . UBS . . . for . . . similar . . . violations . . . UBS . . . continued . . . to . . . fail . . .
How wonderful it must be for UBS to simply keep writing out checks to FINRA! How nice it is to be given the leeway, the latitude, to continue to fail when it comes to FINRA and MSRB rules. I mean, gee, ain't self regulation grand -- or a few hundred grand, or even a million grand? I'm sure that a recidivist FINRA pennystock firm or FINRA boiler-room would also be afforded the luxury of just paying larger and larger fines as it continues to flaunt FINRA's or MSRB's rules. Then again, let's not get carried away here and suggest that UBS is as unseemly as those horrors. I mean, you know, what's the big deal with the 2015 AWC's disclosure under "Relevant Disciplinary History" that:
ln AWC No. 2009018081101 (October 2013), FINRA censured and fined UBS for violating, among other rules, MSRB Rules G-17 and G-30(a). $20,000 of the $260,000 fine was apportioned to the violations of MSRB Rules G-17 and G-30(a). FINRA found that UBS violated MSRB Rules G-17 and G-30(a) by transacting municipal securities between its own account and customers where, in five instances, the aggregate price (including any mark-down or mark-up) was not fair and reasonable.My, my, my -- ain't those dollar fines sumthin'? In 2011 it was $300,000. In 2013 it was $260,000 (apparently a discount for volume). In 2015 it was $750,000. In 2019 it was $2 million.
In AWC No. 2007009401302 (September 2011), FlNRA censured and lined UBS $300,000 for failing to reasonably supervise certain cross-trades of municipal bonds by retail customers, in violation of MSRB Rule G-27.
Wow -- what a very, very effective approach to regulation. There's no consequence other than hitting the big boys of Wall Street with large fines, which, as we all know, are paid out of the pockets of public shareholders. Frankly, UBS has had some incredible defense work over the years. I note that former FINRA Enforcement Chief Susan Merrill, Esq., who left the self-regulator in 2010, signed off as UBS's outside counsel on both the 2015 and 2019 AWCs.
- BGC Memorandum of Agreement
https://ag.ny.gov/sites/default/files/oag_bgc_agreement.9.30.19.pdf - GFI Memorandum of Agreement
https://ag.ny.gov/sites/default/files/oag_gfi_agreement.9.30.19.pdf
Notably, BGC and GFI are prohibited from re-appointing brokers and managers formerly employed on their respective EFX options desks to any supervisory role or any role related to the brokering of FX options for a period of 5 years. The Agreements further require both firms to cooperate fully with the NYAG's ongoing investigation. Further, BGC and GFI are required to implement remedial policies and procedures, to provide training to their employees, and to retain an independent monitor for a period of 12 months, who will report its findings to the NYAG.
As alleged in part in the NYAG Release:
[T]he Attorney General's investigation uncovered the posting of fake trades, bids, and offers by brokers of FX options, in order to ramp up interest from New York traders in largely illiquid emerging market currencies. An FX option is a financial instrument that confers the right to buy or sell a fixed amount of a specified currency at a specified exchange rate on or before a specific expiration date. Globally, trading in FX options averages billions of dollars per day and trillions of dollars per year. Banks typically use multiple, competing brokers for their FX options trading. Bank traders can post bids or offers for FX options directly on the electronic platform of a brokerage firm, but primarily negotiate trades by calling, messaging, or chatting with an individual broker. Brokerage firms are compensated based on volume of executed trades, and individual brokers are paid commissions based on trade volume. Prior to 2013, the FX options market was largely unregulated. However, in the wake of the 2008 financial crisis, the Dodd-Frank Wall Street Reform and Consumer Protection Act required brokers of FX options to retain records regarding their trading activity and communications.The Attorney General's investigation revealed that between January 1, 2014 and December 31, 2015, brokers of FX options for emerging market currencies (EFX options) at BGC and GFI posted fake bids and offers on their electronic platforms for EFX options at a particular level to New York traders, when, in fact, no financial institution had actually bid or offered the option at that level. This practice, known as "flying" prices, was done to create a false appearance of greater liquidity in the EFX options market. During the subject two-year period, brokers at BGC and GFI "flew" hundreds of thousands of bids and offers for EFX options.Additionally, the Attorney General's investigation revealed that between 2014 and 2015, EFX options brokers at BGC and GFI announced fake trades to New York traders that had never actually occurred. This practice is commonly referred to a "printing" a fake trade. Brokers at BGC and GFI "printed" fake trades in EFX options to New York-based traders over the phone, via instant message chats, and on their electronic platform. These non-existent trades were intended to deceive traders into believing that a trade had occurred at a particular level and to induce traders to enter into genuine "follow-on" trades for EFX options, i.e., trades at the level at which broker had falsely reported a trade, in order to generate commissions.
Bill Singer's Comment: I compliment the NYAG's office on responding to the corrosive fraudulent trading practices with bespoke sanctions that creatively address some of the conduct. The NYAG's sanctions are necessary given the nature of the fraud; however, the sanctions also nurture and promote better policies and practices going forward. Of particular merit was the firms' certification that certain of its agents who were employed during the relevant period "are no longer employed," and that for a a five-year period, said agents will not be re-appointed "to any managerial position . . . to any supervisory role related to the brokering of FX Options to New York-Based Traders, or to any position as a broker of FX Options to New York-Based Traders . . ."
New Jersey Court Sustains Banking/Insurance Commissioners Penalties. Marlene Caride, Commissioner, New Jersey Department of Banking and Insurance, Petitioner/Respondent, v. Randolph A. Fisher, Jr., Kevin G. Madden, and Regal Financial Group, LLC, Respondents/Appellants (Opinion, Superior Court of New Jersey/Appellate Division, A-5327-1714 / October 2, 2019)
http://brokeandbroker.com/PDF/FisherNJSC191002.pdf
As set forth in part in the Syllabus to the Opinion:
Appellants Randolph A. Fisher, Jr., Kevin G. Madden, and Regal Financial Group, LLC (Regal) appeal from the final agency decision of the Commissioner of the Department of Banking and Insurance (the Department) imposing monetary penalties and revoking Fisher and Regal's insurance-producer licenses, for violating the New Jersey Insurance Producer Licensing Act of 2001 (IPLA), N.J.S.A. 17:22A-26 to -57, and related regulations. We affirm.
By way of background, the Court alleges in part that [Ed: footnotes omitted]:
Fisher and Madden were each fifty-percent owners of Regal. In October 2006, Fisher and Madden, on behalf of Regal, began to promote and sell an investment plan offered by National Foundation of America (NFOA), a Tennessee corporation not registered to do business, or authorized to sell insurance, in New Jersey. Fisher and Madden collectively met with four sets of prospective purchasers: J.K. and M.K., W.B., G.B. and M.B., and D.C. Each prospective purchaser was over eighty years old and planned using lifetime savings to purchase the plans. All four sets of clients signed an NFOA installment plan agreement. NFOA's application for 26 U.S.C. § 501(c)(3) status as a nonprofit charitable organization was pending before the Internal Revenue Service (IRS) when the meetings took place.
In May 2007, the Tennessee Commissioner of Commerce and Insurance (Tennessee Commissioner) notified the Department of a pending investigation of NFOA. In July 2007, a Tennessee court entered an order appointing the Tennessee Commissioner as a receiver of NFOA. That same month, a courtappointed special deputy receiver requested and received reimbursement from Regal of all commissions associated with the sale of the NFOA investment plans. The refunded commissions totaled $37,489.75. In March 2013, Richard Olive, the president of NFOA, was convicted in federal court of mail fraud, wire fraud, and money laundering. He was sentenced to a thirty-one-year prison term and ordered to pay nearly $6,000,000 in restitution to approximately 190 NFOA plan purchasers.
In January 2011, the Department of Enforcement at the Financial Industry Regulatory Authority (FINRA) filed a disciplinary proceeding against Fisher relating to his sale of NFOA investment plans. In March 2012, FINRA issued an order accepting an offer of settlement that suspended Fisher from associating with FINRA members for six months and required him to pay a $15,000 fine and restitution totaling $47,258.90.The Department asserted Fisher, Regal, and Madden violated IPLA and related regulations. Among other things, it claimed Fisher failed to conduct adequate due diligence prior to recommending the purchase of NFOA investment plans to the four sets of Regal's clients. The Department contended the NFOA product was always "too good to be true," adequate investigation would have revealed NFOA was not granted Section 501(c)(3) status, and NFOA was not authorized to sell insurance products in New Jersey. The Department alleged presenting the product as investment-worthy amounted to misrepresentation that harmed the elderly purchasers.
at Pages 2 - 4 of the Opinion
Following a two-day hearing on the NJ Department's 17-count Order to Show Cause, an Administrative Law Judge ("ALJ") issued a 29-page Initial Decision in which she determined that the Department had failed to prove Counts 13 - 16. In her Initial Decision, the ALJ concluded that:
["F]isher erred, but his mistake did not rise to bad faith." His ability to pay monetary penalties was "very limited" based on his 2015 income tax return. Fisher realized no profit from the sales because the commissions were repaid to NFOA in 2007. As to injury to the public, the ALJ found "the public is harmed when faith in the insurance markets is damaged by illegal activity." The duration of the improper conduct was only five months. The case did not involve criminal activity by Fisher, Regal, or Madden. FINRA imposed a $47,258.90 restitution obligation, a $15,000 fine, and a six-month suspension against Fisher. Madden was not named in the FINRA proceeding. Fisher, Regal, and Madden had no past violations
at Page 10 of the Opinion
Pursuant to her findings, the ALJ recommended imposing:
an aggregate $4000 monetary penalty on counts one, four, seven, and ten; an aggregate $6000 monetary penalty on counts two, five, eight, and eleven; a $500 monetary penalty on count two; an aggregate $400 monetary penalty on counts three, six, nine, and twelve; and a $2000 monetary penalty on count 17. Fisher and Regal were made jointly and severally liable for the monetary penalties on counts one through twelve, totaling $10,900. Madden was made individually liable for the $2000 monetary penalty on count seventeen. Finally, the ALJ concluded license revocation was not warranted, and license suspension should be imposed only if Fisher, Regal, or Madden "fail to comply with the payment of penalties within a reasonable time."
at Pages 10 -11 of the Opinion
The Department filed exceptions to the Initial Decision, and Appellants opoposed those exceptions but did not seek to overturn the ALJ's recommnedations. On review, New Jersey Department of Banking and Insurance Commissioner Marlene Caride adopted the ALJ's findings that the Department had met its burden of proof for Counts 1 - 12 and 17; however, the Commissioner rejected the ALJ's finding that the Department had not met its burden for Counts 13 and 14. Accordingly, the Commissioner found that the Department had prevailed on all Counts with the exception of 15 and 16. Moreover, the Commissioner enhanced the sanctions that had been recommended by the ALJ [Ed: footnotes omitted]:
[T]he Commissioner increased the aggregate penalty assessment on counts one through twelve to $60,000 against Fisher and Regal, for which they were jointly and severally liable. She imposed an aggregate $5000 penalty against Fisher individually on counts thirteen and fourteen. The penalty against Madden on count seventeen was increased from $2000 to $5000.
The Commissioner concluded the record compelled the revocation of Fisher's producer license. She found his "pattern of misrepresentation" related to over $800,000 in sales of annuities to senior citizens over eighty years old. Fisher induced four clients "to divest their life savings from legitimate financial products and invest that money in a product that Fisher had failed to vet prior to his recommendation." He promoted a product that "he should have known" was "too good to be true," yet "was not troubled enough by these enchanted promises to investigate any further." He solicited sales of "an annuity without knowing what it was he was selling to his elderly clients." His misconduct only ceased upon intervention by Tennessee regulatory authorities. His misbehavior was aggravated by his sale of products that were not permitted to be sold in New Jersey by an insurer that was not permitted to do business in this State. Fisher's testimony "indicates that he did not concern himself with the ramifications of recommending elderly clients to invest in a product that could jeopardize their life savings." The Commissioner determined Fisher's breach of trust and fiduciary duties through "gross incompetence" "constitut[ed] a gross deviation from the standard of care required of insurance producers."The Commissioner also found revocation of Regal's insurance producer license was appropriate, since it was vicariously liable for Fisher's actions under N.J.S.A. 17:22A-40(c).
at Pages 15 - 17 of the Opinion
On appeal to the NJ Appellate Division, appellants argued that the penalties imposed by the Commissioner are punitive and disproportionate, and, as such, are unfair and unreasonable. Further, they argue that the revocation is not justified as demonstrated by the ALJ's findings and Initial Decision. Finally, they argue that the Commissioner did not properly consider all the requisite factors when determining her penalties; e.g., .good/bad faith of Defendant; ability to pay, injury to public, nature of misconduct, etc. (the "Kimmelman Test"). In affirming the Commissioner's Final Decision, the Court found that she had acted consistent with the law and pointedly found no evidence of any arbitrary, capricious, or unreasonable conduct. In addressing the disparity between the ALJ and the Commissioner's penalties, the Court noted, in part, that:
[W]ith all due respect to the ALJ's evaluation of sanctions, the Commissioner has the final word as regulator and did not misapply her authority in strengthening them. Although these were appellants' first violations, they jeopardized the lifetime savings of elderly investors through purchasing investment plans that were nothing more than part of a large scale Ponzi scheme. The decision to impose substantial monetary sanctions was reasonable given the nature of the violations, the magnitude of the investments involved, and the need for deterrence. We discern no abuse of discretion.
at Pages 25 - 26 of the Opinion
[In]Securities Guest Blog: Singin' the Varsity Blues, Part 2: Whose Intentions Are Good by Aegis Frumento
(BrokeAndBroker.com Blog)
http://www.brokeandbroker.com/4836/insecurities-aegis-frumento/
So this is where liberal elites make common cause with arch-Trumpistas. Political leanings have nothing to do with it. When it came to their kids, the liberals and the Trumpistas resorted to crime with equal alacrity. None of them, when the cause was sufficiently noble, let little things like laws and norms stand in their way. So what moral standing do any of them have to criticize President Trump for asking a favor in return for military aid? When they decided that it was ok for them to commit crimes for the good of their own kids -- others' kids (the non-cheating applicants) be damned -- they did in their small way what the Donald has always done in his bigly way. They flock together, whether they realize it or not.
SEC Obtains Partial Summary Judgment Against Investment Adviser and Principal On Undisclosed Compensation Claims (SEC Release)
https://www.sec.gov/litigation/litreleases/2019/lr24633.htm
In a Compliant filed in United States District Court for the District of Connecticut
https://www.sec.gov/litigation/complaints/2017/comp24007.pdf, the SEC alleges that investment advisory firm Westport Capital Markets, LLC and its principal Christopher E. McClure breached their fiduciary duties and defrauded their advisory clients by repeatedly purchasing securities that generated significant amounts of undisclosed compensation, enriching themselves at their clients' expense. The Complaint seeks injunctive relief, disgorgement of ill-gotten monetary gains plus interest, and penalties.The Court granted partial summary judgment to the SEC, holding that defendants acted at least negligently when they failed to disclose their conflicts of interest, and that the SEC therefore is entitled to summary judgment on its claims that defendants violated Section 206(2) of the Investment Advisers Act of 1940 and that Westport Capital violated Section 206(3) of the Advisers Act, and McClure aided and abetted that violation. The court reserved for trial questions of material fact as to whether defendants acted intentionally, knowingly, or recklessly under the antifraud provisions of Section 206(1) of the Advisers Act, and as to whether defendants acted willfully under the antifraud provisions of Advisers Act Section 207.
SEC Obtains Final Judgment Against Investment Banker Charged in Insider Trading Scheme (SEC Release)
https://www.sec.gov/litigation/litreleases/2019/lr24634.htm
Former investment bank employee Woojae "Steve" Jung settled SEC's charges and consented to a final judgment entered in the United States District Court for the Southern District of New York permanently enjoining him from violating the antifraud provisions of Sections 10(b) and 14(e) of the Securities Exchange Act and Rules 10b-5 and 14e-3 thereunder and ordering him liable for $130,000 is disgorgement, which will be deemed satisfied by the entry of a forfeiture order in the parallel criminal case; and Jung consented to an order by the SEC imposing securities industry and penny stock bars. Jung was charged with repeatedly using his access to highly confidential information in order to place itrades in advance of deals on which the bank was providing investment banking services. In the parallel criminal case, Jung pled guilty to securities fraud and was sentenced to 3 months in prison plus 2 years of supervise release and ordered to pay a $130,000, forfeiture and $30,000 fine.
SEC Obtains Final Judgments Against Lek Securities and CEO in Layering, Manipulation Case Litigation Continues Against Ukraine-Based Firm, Individuals (SEC Release)
https://www.sec.gov/news/press-release/2019-205
In a Complaint filed in the United States District Court for the Southern District of New York, the SEC alleged that Lek Securities Corp. and its Chief Executive Officer Sam Lek helped facilitate manipulative trading schemes by its customer, Avalon FA Ltd., headquartered in Kiev. Allegedly, Avalon profited from layering (placing and canceling orders to trick others into buying or selling stocks at artificial prices), and cross-market manipulation, which involved buying or selling stocks to artificially impact options prices. Allegedly, Lek Securities and Sam Lek provided Avalon access to the U.S. markets, relaxing the brokerage firm's layering controls after Avalon complained, allowing Avalon to conduct the trading activity, and improving Lek Securities' technology to assist Avalon's trading. On consent, the Court entered final judgments whereby, as noted in part in the SEC Release:
[L]ek Securities agreed to a three-year injunction requiring it to terminate business with foreign customers potentially engaged in market manipulation or manipulative trading and largely prohibiting it from providing intra-day trading to foreign customers. Lek Securities also agreed to retain an independent compliance monitor for a three-year period and, along with Sam Lek, agreed to permanent injunctions from violations of the charged anti-fraud and manipulative trading provisions. Lek Securities will pay a $1 million penalty plus $525,892 in disgorgement and prejudgment interest, and Sam Lek will pay a $420,000 penalty. In settling the SEC's charges, Lek Securities and Sam Lek admit that as alleged in the SEC's complaint, Avalon's trading activity through Lek Securities constituted violations of the federal securities laws.
Defendants Charged in Fraudulent ICO to Pay Nearly $7 Million (SEC Release)
https://www.sec.gov/litigation/litreleases/2019/lr24635.htm
In a Complaint filed in the United States District Court for the Eastern District of New York https://www.sec.gov/litigation/complaints/2017/comp-pr2017-219.pdf, the SEC alleged that Dominic Lacroix and his company PlexCorps marketed and sold securities called PlexCoin on the internet to investors in the U.S. and elsewhere, claiming that investments in PlexCoin would yield a 1,354 percent profit in less than 29 days. The SEC also charged Lacroix's partner, Sabrina Paradis-Royer, in connection with the scheme.The Court entered a final judgment against PlexCorps, Lacroix, and Paradis-Royer, who, without admitting or denying the allegations in the Complaint were enjoined from further violations of Sections 5(a), 5(c), and 17(a) of the Securities Act, and Section 10(b) of the Securities Exchange Act and Rule l0b-5 thereunder, and Lacroix and Paradis-Royer are additionally enjoined from participating in any digital-securities offerings. All Defendants are ordered to disgorge, on a joint and several basis, $4,563,468 in ill-gotten gains from the PlexCoin Initial Coin Offering plus $348,145 in prejudgment interest, and Lacroix and Paradis-Royer are ordered to each pay a $1,000,000 civil penalty. Also, Lacroix is permanently barred from serving as an officer or director of a publicly traded entity.
Dark Web Vendors Plead Guilty to Cryptocurrency Money Laundering Conspiracy (DOJ Release)
https://www.justice.gov/usao-sdca/pr/dark-web-vendors-plead-guilty-cryptocurrency-money-laundering-conspiracy
Aidan Curry and Connor Brooke plead guilty in the United States District Court for the Southern District of California to conspiracy to launder money. The Defendants agreed to forfeit tens of thousands of dollars' worth of cash, cryptocurrency, and high-end, sophisticated hardware including computers, phones, hard drives and storage devices that were involved in the money laundering conspiracy. As alleged in part in the DOJ Relesase:
Special Agents from Homeland Security Investigations identified Curry and Brooke as managers of a San Diego-based business advertising the ability and willingness to sell Bitcoin (a specific type of cryptocurrency) for a premium, and always in cash, to the public. Persons who purchase or sell contraband on online black markets (also known as the "Dark Web") use cryptocurrency such as Bitcoin to conduct transactions. Cryptocurrency provides a vendor and customer with perceived anonymity. The Dark Web is a network of encrypted communication systems that can only be accessed using special software tools. Before someone can use cryptocurrency, they must first convert their "real," fiat currency (such as United States Dollars) into the cryptocurrency. A common way to do so is through an unlicensed money transmitting business (an "MTB") that exchanges cryptocurrency for cash.
As admitted in the plea agreements entered today before U.S. Magistrate Judge Michael S. Berg, Curry and Brooke conducted, controlled, managed, supervised, directed and owned all or part of a cryptocurrency MTB called "BayCoins." Curry described the unlicensed MTB to an acquaintance over text messages, stating: "I'm basically like a currency exchange place for Bitcoin"; and that he and Brooke advertised their MTB on a website that was equivalent to the "Craigslist of bitcoin".
By August 2018, BayCoins had posted two separate online solicitations - one with Curry's information and the other with Brooke's. The advertisements promised "quick, easy, and hassle free" Bitcoin transactions, with a "non-negotiable" five percent transaction fee, and always for cash. By accepting cash in exchange for cryptocurrency, as opposed to other forms of payment such as electronic money transfers, checks, or cash deposits into a bank account, Curry and Brooke operated their MTB in relative anonymity and evaded the anti-money laundering scrutiny of other licensed and registered financial institutions. This anonymity extended to their customers as well.BayCoins generated sufficient profits, alongside a growing inventory of cryptocurrency, to fund the defendants' acquisition, sale, and distribution of marijuana on various Dark Web marketplaces. After receiving payment for the marijuana, Curry and Brooke then sold the cryptocurrency for additional profit through the BayCoins unlicensed MTB.
'The IPO process has devolved,' tech investor Bill Gurley says as he leads a direct listing movement (CNBC.com by Lauren Feiner)
https://www.cnbc.com/2019/10/02/tech-investor-bill-gurley-says-the-ipo-process-has-devolved.html
Benchmark Capital General Partner Bill Gurley advocates the Direct-Listing model over the traditional Initial Public Offering. As noted in the provocative CNBC article, Gurley believes that:
In the past three years it's gotten worse and I think that's because the IPO process has devolved . . . it used to be that the IPO process was about disseminating and marketing and selling far and wide and it's become a game of just hand-allocating shares to the same 10 or 15 firms.Market Regulation Enforcement: Ensuring Market Integrity (FINRA Unscripted)
As noted in the podcast's notes:
What happens if a brokerage firm doesn't report trading information appropriately? At first, it might seem like it isn't a big deal - just a data issue. But is vital. Accurate market data is at the foundation of FINRA's efforts to ensure the integrity of our markets.
On this episode of FINRA Unscripted, we are joined by Lizzie Hogan, senior vice president of Market Regulation Enforcement, to learn what her group does, how it fits under the broader Enforcement team umbrella and why market data cases matter.Bill Singer's Comment: One of FINRA's better podcasts. Interesting subject matter presented in a compelling fashion. Nice job!
FINRA 2019 Industry Snapshot
https://www.finra.org/sites/default/files/2019%20Industry%20Snapshot.pdf
As set forth in the FINRA Report's preamble:
The 2019 FINRA Industry Snapshot provides a high-level overview of the industry, ranging from the number of FINRA-registered individuals to the overall revenues of firms, and from trading activity to how firms market their products and services. All of the data are reported in aggregate to respect the confidentiality of regulatory information.