DOB: Summer 2010 Securities Bulletin

Securities and Business Investments Division

Securities Bulletin

Vol. XXIV  No. 2
Summer 2010

Features

Enforcement and Other Highlights
Contributors

Ralph Lambiase, Division Director
Cynthia Antanaitis, Assistant Director and Bulletin Editor
Eric Wilder, Assistant Director


A WORD FROM THE BANKING COMMISSIONER

On July 21, 2010, President Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, 124 Stat. 1376 (2010).  One of the major changes wrought by the legislation is that investment advisers with assets between $25 million (the current state threshold) and $100 million will now fall under state only jurisdiction.  Previously, state regulation extended only to advisers with $25 million or less in assets under management.  We approximate that, for Connecticut-domiciled advisers alone, our advisory registrant base will increase by approximately 35%.  The examination and review time necessary for investment advisers with greater than $25 million under management rises exponentially as a result of the increased complexity of the examination or review.  Obtaining sufficient staffing to carry out our investor protection mission and provide responsive services to the industries we regulate will be challenging given state budgetary constraints.

The Department will explore further effects of the Dodd-Frank financial services reform legislation at its annual Securities Forum on October 19, 2010.  Securities Forum 2010:  Revolution in Reform will be held at the New Haven Lawn Club.  The featured luncheon speaker will be David Fein, U.S. Attorney for the District of Connecticut.  Appointed as Connecticut's U.S. Attorney by President Barack Obama in May 2010, Mr. Fein brings to the position years of experience investigating white collar crime, racketeering, money laundering, bank fraud and securities fraud.  To read more about our Securities Forum and to download a registration form, please visit our website.

In June 2010, the department’s Securities Division and AARP joined forces to launch the Free Lunch Monitor program.  The program is part of a national campaign to monitor whether older investors receiving invitations to “free” seminars and luncheons are being pressured to buy investments that are not suitable for them and to part with personal financial information.  Seniors and others who volunteer to be a Free Lunch Monitor bring a Free Lunch Monitor Checklist to investment seminars and return the completed checklists to the department.  Reviewing the completed checklists helps us assess whether the seminar promoters are running afoul of the state’s securities laws.  I firmly believe that having the eyes and ears of Free Lunch Monitors at these events is a boon to the Securities Division’s investor protection goals.

As always, we welcome your feedback and suggestions.

Howard F. Pitkin
Banking Commissioner


Grosvenor Partners, Ltd. a/k/a Aster Associates – Order to Cease and Desist and Notice of Intent to Fine Issued 
 
On June 24, 2010, the Commissioner entered an Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing (Docket No. CF-2010-7661-S) against Grosvenor Partners, Ltd. a/k/a Aster Associates, a limited partnership located at 223 Coral Lane, Palm Beach, Florida.  The respondent’s general partner is Mayfair Ventures, G.P.  Frank J. Avellino is the general partner of Mayfair Ventures, G.P.  The action alleged that, commencing in June 1995, Grosvenor Partners, Ltd. violated the antifraud provisions in Section 36b-4(a) of the Connecticut Uniform Securities by failing to make key disclosures to investors, including the fact that Frank J. Avellino had been the subject of a 1992 Order of Preliminary Injunction and Other Equitable Relief on Consent procured by the Securities and Exchange Commission (Securities and Exchange Commission v. Avellino & Bienes et al., No. 92-CF-8314 (S.D.N.Y)).   The SEC action had alleged that Frank Avellino guaranteed that investors could achieve a return of between 13.5% and 20% by investing monies with Bernard L. Madoff.  The June 24, 2010 Order to Cease and Desist and Notice of Intent to Fine also alleged that the respondent failed to tell at least one Connecticut investor that all of the investor’s funds would be placed with Bernard Madoff.  In addition, the action alleged that, the respondent’s offering of limited partnership interests violated Section 36b-16 of the Act, notwithstanding a prior Rule 506 exemptive filing, since the offering did not meet the criteria for an exemption under Rule 506.  Grosvenor Partners, Ltd. was afforded an opportunity to request a hearing on the Order to Cease and Desist and Notice of Intent to Fine.

S&E Investment Group – Order to Cease and Desist and Notice of Intent to Fine Issued

On June 24, 2010, the Commissioner entered an Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing (Docket No. CF-2010-7660-S) against S&E Investment Group, a general partnership having its principal office at 670 Tennis Club Drive, Fort Lauderdale, Florida.  The action alleged that, from at least July 1993 forward, the respondent sold unregistered partnership interests to at least one Connecticut investor, notwithstanding the investor’s lack of experience in financial and business matters.  The interests were purportedly sold absent registration under Section 36b-16 of the Connecticut Uniform Securities Act to investors who would take no active role in partnership management.  The action also alleged that the respondent violated the antifraud provisions in Section 36b-4(a) of the Act by failing to make material disclosures to investors, including disclosures regarding risk, how investor funds would be invested and financial information on the respondent.   S&E Investment Group was afforded an opportunity to request a hearing on the Order to Cease and Desist and Notice of Intent to Fine.

TDA Advantage Trust and Thomas F. DeSteph Each Fined $30,000 Following a Hearing; Amended and Restated Order to Cease and Desist Made Permanent

On June 4, 2010, the Commissioner issued Findings of Fact, Conclusions of Law and Order (Docket No. CF-2008-7555-S) in the matter of TDA Advantage Trust and Thomas F. DeSteph, both of 1 Dustin Lane, Jaffrey, New Hampshire.  The Respondents had been the subject of a July 16, 2009 Amended and Restated Order to Cease and Desist and an Amended and Restated Notice of Intent to Fine (Docket No. CF-2008-7555-S) which superseded an April 7, 2009 Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing.  Although the Amended and Restated Order to Cease and Desist and the Amended and Restated Notice of Intent to Fine were contested by respondent DeSteph, no appearance was filed on behalf of TDA Advantage Trust.

Following a hearing, the Commissioner concluded that 1) the respondents had violated Section 36b-16 of the Connecticut Uniform Securities Act by selling unregistered limited partnership interests, later documented as a “TDA Note”; and 2) in contravention of Section 36b-6(b) of the Act, TDA Advantage Trust employed respondent DeSteph as an unregistered agent of issuer, and respondent DeSteph acted in such capacity.  In addition, the Commissioner concluded that the respondents violated the antifraud provisions in Section 36b-4(a) of the Act by failing to disclose, among other things, any risk factors associated with the investment, any financial information on the respondents, that the respondents would not make promised payments on the investment or that respondent DeSteph would use the investor’s money to pay for his personal and household expenses.

The Commissioner ordered that the Amended and Restated Order to Cease and Desist issued against each respondent be made permanent; and that each respondent pay a $30,000 fine.

Itradedirect.com Corp. (CRD # 18281) Ordered to Cease and Desist from Regulatory Violations; Notice of Intent to Revoke Registration as Broker-dealer and Notice of Intent to Fine Issued

On June 3, 2010, the Banking Commissioner issued an Order to Cease and Desist, Notice of Intent to Revoke Registration as Broker-dealer and Notice of Intent to Fine (Docket No. RCF-10-7699-S) with respect to Itradedirect.com Corp., a broker-dealer having its principal office at 1600 NW Boca Raton Boulevard, Suite 22, Boca Raton, Florida.  The action alleged that the firm violated the antifraud provisions in the Connecticut Uniform Securities Act and engaged in dishonest and unethical practices by not disclosing to Connecticut customers that a $65 per transaction “Handling Fee” was not based on actual handling costs but included a profit to the firm.  The action also alleged that the firm 1) violated Section 36b-6(b) of the Act by employing at least five unregistered agents; and 2) violated Section 36b-31-6f of the Regulations under the Act by allowing its agents to use unapproved sales scripts in their communications with the public.  The firm was provided with an opportunity to request a hearing on the Order to Cease and Desist, Notice of Intent to Revoke Registration as Broker-dealer and Notice of Intent to Fine.  Since the firm did not request a hearing on the Order to Cease and Desist, the Order to Cease and Desist became permanent on July 23, 2010.

Nicholas Alexander Smirnow Fined $85,000 for Selling Unregistered Securities, Engaging in Securities Fraud

On June 3, 2010, the Banking Commissioner entered an Order Imposing Fine (Docket No. CF-2010-7588-S) with respect to Nicholas Alexander Smirnow a/k/a Nick Smirnow of 2635 Hwy. #117, P.O. Box 66, Baysville, Ontario, Canada POB 1AO and 1013 Fairy Falls Road, Baysville, Ontario, Canada POB 1AO.  Respondent Smirnow purportedly did business under the names P-2-P Network and Pathway-2-Prosperity.  The respondent had been the subject of a February 26, 2010 Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing alleging that, from at least 2008, the respondent offered and sold unregistered membership interests in the Pathway-2-Prosperity high yield investment program in contravention of Section 36b-16 of the Connecticut Uniform Securities Act.  The February 26, 2010 action had also alleged that respondent Smirnow violated the antifraud provisions in Section 36b-4(a) of the Act in that no meaningful explanation was offered to investors concerning how the Pathway-2-Prosperity program achieved its represented high returns; no meaningful explanation was offered to investors concerning the basis for the program’s claim that investor principal was guaranteed against loss; no disclosures were made to program members concerning exactly how member funds would be invested; and no disclosures were made concerning the identities of those persons managing program funds or any background information on the P-2-P Network.  Since Respondent Smirnow had not requested a hearing on the Order to Cease and Desist, the Order to Cease and Desist had become permanent on April 28, 2010.

Respondent Smirnow likewise did not request a hearing on the Notice of Intent to Fine.  Under Section 36a-1-31(a) of the Regulations of Connecticut State Agencies, the allegations against a party may be deemed admitted where the party fails to request a hearing on the matters alleged.  Adopting the allegations in the Order to Cease and Desist and Notice of Intent to Fine as findings, the Commissioner concluded that Respondent Smirnow violated Sections 36b-16 and 36b-4(a) of the Act.  The Order Imposing Fine directed Respondent Smirnow to pay a fine of $85,000 to the agency.

Royal Burgundy International, Inc. Fined $25,000 for Selling Unregistered Coffee Distributorship Business Opportunities

On May 7, 2010, the Banking Commissioner entered an Order Imposing Fine (Docket No. CF-2009-865-B) against Royal Burgundy International, Inc. of 172 W. Warren Avenue, Suite 200, Longwood, Florida.  The respondent had been the subject of a December 23, 2009 Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing alleging that, from at least August 2008 forward, the respondent offered and sold coffee distributorship business opportunities to at least one Connecticut purchaser-investor in contravention of Section 36b-67 of the Connecticut Business Opportunity Investment Act.  The Order to Cease and Desist, being uncontested, had become permanent on January 29, 2010.  The respondent did not request a hearing on the Notice of Intent to Fine.  Under Section 36a-1-31(a) of the Regulations of Connecticut State Agencies, a party’s failure to request a hearing may result in the allegations against the party being admitted.

In fining the respondent $25,000, the Commissioner adopted as findings the allegations in the Order to Cease and Desist and Notice of Intent to Fine, and concluded that the respondent had violated Section 36b-67 of the Connecticut Business Opportunity Investment Act.

Donald C. Lyle d/b/a Noirstar Financial Services Ordered to Cease and Desist from Selling Unregistered Securities; Notice of Intent to Fine Issued

On May 7, 2010, the Banking Commissioner issued an Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing (Docket No. CF-2010-7556-S) against Donald C. Lyle, now or formerly of 2346 Eutaw Place, Unit 2, Baltimore, Maryland.  Respondent Lyle purportedly did business under various names, including Noirstar Financial Services, and held Noirstar Financial Services out as having a business address at 1337 Dixwell Avenue, Hamden, Connecticut.

The action alleged that, from at least November 29, 2007 forward, respondent Lyle sold unregistered securities in the form of investment contracts, notes and/or an evidence of indebtedness in contravention of Section 36b-16 of the Connecticut Uniform Securities Act.  The action also alleged that respondent Lyle violated the antifraud provisions in Section 36b-4 of the Act by failing to disclose to investors, among other things, any risk factors related to the investment; financial information on the Respondent or his businesses; the income sources from which the investments would be repaid or that the Respondent had been the subject of three Chapter 13 bankruptcy proceedings filed in Connecticut bankruptcy court.  The respondent was afforded an opportunity to request a hearing on the Order to Cease and Desist and Notice of Intent to Fine.  Since the respondent did not request a hearing on the Order to Cease and Desist, the Order to Cease and Desist became permanent on May 27, 2010.

James Fowler Hickman a/k/a Jay Hickman Fined $2,500, Directed to Refund Sales Commission to Connecticut Investors Following Allegations of Unregistered Activity

On June 28, 2010, the Banking Commissioner entered a Consent Order (No. CO-10-7745-S) with respect to James Fowler Hickman a/k/a Jay Hickman. Hickman, a registered broker-dealer agent under the Connecticut Uniform Securities Act, is also a principal of Aquinnah Investments, LLC of 65 Marlborough Street, Boston, Massachusetts.  The Consent Order alleged that James Hickman and Aquinnah Investments, LLC obtained investors for Grove Electronics, LLC d/b/a Chip Partners, a North Reading, Massachusetts issuer of securities.  At the time James Hickman engaged in such activity, he was not registered as an agent of issuer or in any other capacity under the Act nor was Aquinnah Investments, LLC registered as a broker-dealer in Connecticut.

The Consent Order directed James Hickman to 1) cease and desist from regulatory violations; 2) absent the prior written approval of the Division Director, refrain from offering or selling securities on behalf of any issuer in or from Connecticut unless the transactions were effected within the scope of Hickman’s employment with a Connecticut registered broker-dealer; and 3) refrain from representing multiple broker-dealers or investment advisers absent written permission from the Division Director.  In addition, the Consent Order fined Hickman $2,500, and required that Hickman refund to affected Grove Electronics, LLC investors in Connecticut the pro rata share of sales commission Hickman earned that was attributable to the Connecticut sales.

David P. Petruzzi (CRD # 5230413) Precluded from Conducting Securities Business in Connecticut for 24 Months

On June 23, 2010, the Commissioner entered a Consent Order (No. CO-10-7758-S) with respect to David P. Petruzzi, an applicant for broker-dealer agent registration under the Connecticut Uniform Securities Act.  The Consent Order recited that, in connection with its review of the application, the Division obtained evidence that, on July 24, 2008, the State of Connecticut Insurance Department had issued a Complaint, Stipulation and Final Order (Docket No. MC-08-25) against David Petruzzi.  The Insurance Department action had placed all of David Petruzzi’s insurance licenses on probation for one year and had fined David Petruzzi $500 following allegations that Petruzzi endorsed an unsuitable insurance policy to an elderly Connecticut resident and misrepresented himself by signing the related insurance application as the applicant’s “trusted relative, friend or financial advisor.”

The Consent Order precluded Petruzzi, for twenty-four months, from 1) applying for registration or transacting business as an agent, investment adviser agent, broker-dealer or investment adviser in Connecticut; 2) supervising any broker-dealer agents with respect to securities business conducted in or from Connecticut; and 3) acting as a finder for compensation, receiving or splitting commissions or receiving referral fees in connection with the offer, sale or purchase of securities in Connecticut.  The twenty-four month period would run from the date of Petruzzi’s application for agent registration and would conclude on November 1, 2011.

UBS Securities LLC (CRD # 7654) and UBS Financial Services Inc. (CRD # 8174) Fined $2,098,792 in Connection With Auction Rate Securities Activity

On May 26, 2010, the Banking Commissioner entered a Consent Order (Docket No. CO-10-7506-S) with respect to UBS Securities LLC and UBS Financial Services Inc.  The settlement, which acknowledged that the firms had purchased up to $574.5 million in auction rate securities (ARS) from Connecticut investors, followed a multi-state investigation focusing on the firms’ sale of ARS, which brokerage firms marketed as safe and liquid alternatives to cash.

The multi-state investigation found that securities brokerage firms selling ARS told their clients the securities were cash-like instruments that could be accessed at almost any time.  In fact, ARS were long-term bonds subject to a complex auction process that, upon failure, resulted in accounts being frozen and lower interest rates on the bonds.   The Consent Order alleged that UBS knew of the impending collapse of the ARS market in early 2008 but took insufficient steps to protect its clients and continued to sell the securities.

The Consent Order directed that UBS Securities LLC and UBS Financial Services Inc. pay a $2,098,792.26 fine to the department in resolution of the matter.

Financial Partners LLC (IARD # 146697) and Douglas Kirk Landeen (CRD # 5421409) – Consent Order Entered

On May 7, 2010, the Banking Commissioner entered a Consent Order (Docket No. NDCD-2010-7769-S) resolving the allegations in a January 21, 2010 Notice of Intent to Deny Registration as an Investment Adviser and as an Investment Adviser Agent, Order to Cease and Desist and Notice of Right to Hearing in the matter of Financial Partners LLC and Douglas Kirk Landeen.  Financial Partners LLC is a Connecticut limited liability company with its principal office at 123 Hopmeadow Road, Bristol, Connecticut.  Respondent Landeen is the sole direct owner and managing member of Financial Partners LLC.  The Notice of Intent to Deny Registration as an Investment Adviser and as an Investment Adviser Agent, Order to Cease and Desist and Notice of Right to Hearing had alleged that a basis existed to deny Respondent Financial Partners LLC’s investment adviser registration under the Connecticut Uniform Securities Act due to the firm’s failure to fulfill the experience requirements in Section 36b-31-7b of the Regulations under the Act.  The action had also alleged that, on two separate occasions, Respondent Landeen had filed with the Commissioner a Form U-4 (Uniform Application for Securities Industry Registration or Transfer) that failed to disclose that, on July 27, 1998, Respondent Landeen had been sentenced to 27 months in prison after pleading guilty to violations of 18 U.S.C. 1341 (Mail Fraud) and 26 U.S.C. 7206(1) (Wilful Subscription to False Tax Return), both felonies (U.S. v. Landeen, D. Conn. Case No. 3:98-CR 63 JBA).  Respondent Landeen’s failure to disclose his prior criminal history allegedly violated Section 36b-23 of the Act and Section 36b-31-14e of the Regulations, thus constituting a basis for the denial of Respondent Landeen’s investment adviser agent registration and the entry of a cease and desist order against him.

Without admitting or denying the department’s allegations, the respondents agreed to the entry of a consent order.  Pursuant to the Consent Order, Financial Partners LLC agreed to withdraw its investment adviser application, and Douglas Kirk Landeen agreed to withdraw his application for registration as an investment adviser agent of Financial Partners LLC.  The Consent Order also barred Douglas Kirk Landeen for ten years from transacting business in or from Connecticut as a broker-dealer, agent, investment adviser or investment adviser agent.  Respondent Landeen could apply for relief from this restriction after seven years elapsed from the entry of the Consent Order.  The Consent Order also directed respondent Landeen to cease and desist from violating the Connecticut Uniform Securities Act or any regulation or order under the Act.

Eric Kipperman and CRF Group, LLC – Ten Year Bar Imposed Following Sales of CRE Capital Corporation 30 Day Currency Trading Contracts

On April 12, 2010, the Banking Commissioner entered a Consent Order (No. CO-10-7685-S) with respect to CRF Group, LLC, a Connecticut limited liability company located at 335 Kettletown Road, Southbury, Connecticut and its managing member, Eric Kipperman.  The Consent Order alleged that, from May 2008 through December 2008, CRF Group, LLC and Eric Kipperman sold unregistered 30 Day Currency Trading Contracts issued by CRE Capital Corporation in violation of Section 36b-16 of the Connecticut Uniform Securities Act.  The Consent Order also alleged that Eric Kipperman was not registered as an agent under Section 36b-6(a) of the Act nor was CRF Group, LLC registered as a broker-dealer under Section 36b-6(a) of the Act.  CRE Capital Corporation is a Georgia corporation located at 3700 Manswell Road, Suite 220, Alpharetta, Georgia.  On January 15, 2009, the United States District Court for the Northern District of Georgia, Atlanta Division, had entered an Order Granting Permanent Injunction, Freezing Assets, Appointing a Receiver and Ordering Other Ancillary Relief against CRE Capital Corporation (SEC v. CRE Capital Corporation; Civil Action File No. 1 09-CF-0114).

The Consent Order barred Eric Kipperman from transacting business in or from Connecticut as a broker-dealer, agent, investment adviser or investment adviser agent for ten years.  No fine was imposed against Eric Kipperman due to Eric Kipperman’s demonstrated inability to pay.  The Consent Order also directed Eric Kipperman and CRF Group, LLC to cease and desist from regulatory violations.  In addition, the Consent Order provided that, if Eric Kipperman or CRF Group, LLC recovered any funds as a result of the Georgia receivership proceeding involving CRE Capital Corporation or from any other source relating to the 30 Day Currency Trading Contracts, Eric Kipperman would notify the agency and, in a plan approved by the Division Director, distribute those funds pro rata to each Connecticut investor to whom Eric Kipperman and/or CRF Group, LLC sold 30 Day Currency Trading Contracts and who sustained investment losses.

Millbrae Natural Gas Development Fund 2005, L.P. and Millbrae Natural Gas 2005, L.L.C. Collectively Fined $2,300 for Unregistered Security Sales, Unregistered Agent of Issuer Activity

On May 17, 2010, the Banking Commissioner entered into a Stipulation and Agreement (No. ST-10-7763-S) with Millbrae Natural Gas Development Fund 2005, L.P. (the “Millbrae Fund”) and its managing partner, Millbrae Natural Gas 2005, L.L.C., both of 29 Upper Hook Road, Katonah, New York.  The Stipulation and Agreement recited that, during an examination of Millbrae Capital LLC, now known as Raine Securities LLC (CRD number 137873), the Division ascertained that in 2005 and 2006, unregistered interests in the Millbrae Fund had been sold to Connecticut investors through unregistered agents of issuer.   The Stipulation and Agreement acknowledged that, on March 1, 2010, a corrective Rule 506 notice filing had been made under Section 36b-21(e) of the Connecticut Uniform Securities Act covering the prior offering of the Millbrae Fund securities.  Pursuant to the Stipulation and Agreement, the Millbrae Fund and its managing partner agreed to jointly and severally remit a $2,300 fine to the department.  In addition, the Millbrae Fund and its managing partner agreed to refrain from offering or selling securities in or from Connecticut absent compliance with the Section 36b-16 of the Act and to refrain from employing unregistered agents of issuer in contravention of Section 36b-6(b) of the Act.

Bear Stearns Asset Management Inc. (CRD # 113359) – Stipulation and Agreement

On May 5, 2010, the Banking Commissioner entered into a Stipulation and Agreement (No. ST-10-7684-S) with Bear Stearns Asset Management Inc., an investment adviser registered with the Securities and Exchange Commission.  The firm acted as investment adviser to Bear Stearns High Grade Structured Credit Strategies Enhanced Leverage Fund, L.P. and Bear Stearns High Grade Structured Credit Strategies L.P.   The Stipulation and Agreement alleged that, from at least September 1, 2003 to at least July 31, 2007, certain related party transactions engaged in by the firm were not properly or timely approved prior to execution, as required by the private placement memorandum received by investors in the funds and that, during that time period, certain other related party transactions were approved notwithstanding the fact that the approval requests contained certain informational deficiencies.  The Stipulation and Agreement recited that the firm had voluntarily commenced a settlement process with certain non-institutional investors in the funds; that certain investors alleged that they were coerced into entering into the settlement; and that such conduct could constitute a basis for administrative proceedings under Sections 36b-5(f) and 36b-27 of the Connecticut Uniform Securities Act.

The Stipulation and Agreement required that the firm submit to an initial binding mediation procedure covering any Connecticut investor who believed that he or she was coerced into settling with the firm.  If the initial mediator determined that an affected Connecticut investor was coerced into settling, then the firm would nullify the settlement and provide for a second binding mediation to address the factual and legal dispute underlying the settlement, any claims released by the investor and the investor’s right, if any, to damages or other legal remedies.


STATISTICAL SUMMARY

Licensing At A Glance
at the end of the quarter

1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
Broker-dealers Registered 2,465  2,509      
Broker-dealer Agents Registered 136,757 140,300     
Broker-dealer Branch Offices Registered 2,741  2,715    
Investment Advisers Registered 483  496    
SEC Registered Advisers Filing Notice 1,839  1,871    
Investment Adviser Agents Registered 9,824 9,947     
Agents of Issuer Registered 25 25     
Conditional Registrations
0
0
 
 
 

Securities and Business
Opportunity Filings

1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
Year
to Date
Offerings Reviewed 45 44 
 
  89
Investment Company Notice Filings 781  511
 
  1,292
Exemptions and Exemptive Notices 666  658     1,324
 
 
Examinations
     
Broker-dealers 21 22 
 
  43
Investment Advisers 4 16 
 
  20
 
 
Securities Investigations
 
Opened 48 29   
 
77
Closed 63 36   
 
99
Ongoing as of End of Quarter 141 134   
 
 
Subpoenas issued 6 10      16
Matters referred from Attorney General 2  3     5
Matters referred from Other Agencies 7  0     7
 
 
Business Opportunity Investigations
 
Investigations Opened 3 2     5
Investigations Closed 4 2     6
Ongoing as of End of Quarter 3 3    
 
 
Enforcement: Remedies and Sanctions
 
Notices of Intent to Deny (Licensing) 1
0
 
 
1
Notices of Intent to Suspend (Licensing)
0
0
 
 
0
Notices of Intent to Revoke (Licensing)
0
1
 
 
1
Denial Orders (Licensing) 0 0
 
  0
Suspension Orders (Licensing) 0 0
 
  0
Revocation Orders (Licensing) 0 0
 
  0
Notices of Intent to Fine 2 4
 
  6
Orders Imposing Fine 4 3
 
  7
Cease and Desist Orders 3 4
 
  7
Notices of Intent to Issue Stop Order 0 0
 
  0
Activity Restrictions/Bars 2 3     5
Stop Orders 0 0     0
Vacating/Withdrawal/ Modification Orders 1 0     1
Restitutionary Orders 0 0
 
  0
Injunctive Relief Obtained 1 0     1
 
 

Proceedings and Settlements

1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
Year
to Date
Administrative Actions
7
7
 
 
14
Consent Orders
5
5
 
 
10
Stipulation and Agreements
1
2
 
 
3
 
 

Monetary Relief*

1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
Year
to Date
Monetary Sanctions Imposed
$571,630
$2,273,592
 
 
$2,845,222
Financial Literacy
0
 
 
 
0
Law enforcement protecting public
0
$300,000
 
 
$300,000
Restitution or Other Monetary Relief ( includes rescission offer amounts) $34,265
$575,204,111
 
 
$575,238,376

*Cents rounded to next dollar

 

Securities Referrals

1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
Year
to Date
Criminal (Chief State's Attorney)
0
0
 
 
0
Civil (Attorney General)
0
0
 
 
0
Other Agency Referrals
1
3
 
 
4



Securities Division