The New York based brokerage firm, Aegis Capital Corp, agreed to pay $950,000 to settle allegations with the Financial Industry Regulatory Authority (FINRA). The regulator accused Aegis of the improper sales of billions of shares in unregistered penny stocks and for supervisory lapses. FINRA found that from April 2009 to June 2011, Aegis liquidated approximately 3.9 billion shares of five unregistered penny stocks that were not exempt from SEC registration.
In addition, FINRA suspended and fined two chief compliance officers,Charles D. Smulevitz and Kevin C. Mckenna, for their supervisory failures. According to FINRA “There were many “red flags” associated with the transactions, including that the customers were referred to Aegis by a single former securities broker who was barred from the industry and who controlled the activity in several of the Aegis accounts. Without conducting a reasonable inquiry into the red flags, Aegis sold the unregistered shares in violation of the registration requirements of the securities laws.”
Without admitting or denying Finra’s accusations, Aegis consented to the fine. Furthermore Aegis will be required to retain an independent consultant to review their supervisory and anti-money laundering systems and procedures.
The foregoing information, which is all publicly available, is being provided by The White Law Group. The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida.
If you have concerns regarding investments you purchased through Aegis Capital Corp and would like to speak with a securities attorney, please call The White Law Group at (312)238-9650.
For more information on The White Law Group, visit www.whitesecuritieslaw.com.