Garden State Securities, Inc. (CRD #10083, Red Bank, New Jersey) recently submitted a Letter of Acceptance, Waiver and Consent in which the firm was censured and fined $50,000.
Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings that it failed to provide a complete response to a FINRA request for information and documents. The findings stated that the firm provided information and documents in response to the request letter, and indicated to FINRA that all relevant documents had been produced. The firm, however, failed to provide all due diligence files for any and all private placements. During an on-the-record interview, the firm disclosed for r the first time that additional due diligence documents existed that had not been produced, and subsequently provided the additional documents to FINRA. The findings also stated that the firm failed to establish, maintain and enforce a system of written supervisory control policies and procedures reasonably designed to review and monitor all transmittal of funds (e.g., wires or checks) or securities from customers to third-party accounts and/or from customer accounts to outside entities. The firm did not adequately supervise wire activity in its branch offices. As a result, the firm failed to prevent the altering of wire request forms in customer accounts. The findings also included that the customers had ordered the wire transfers, authorizing the transfer of funds from their firm account to a third party’s bank account or an outside entity. A firm clerical employee, however, failed to obtain properly signed wire request forms for those transactions. Instead, the employee altered copies of earlier signed firms by applying correction fluid over the original dates and dollar amounts and then writing in the dates and dollar amounts for the current transactions. Those forms were then used to process the transactions.
This information which is publicly available on FINRA’s website has been provided by The White Law Group, LLC.
If you have questions about investments you made with Garden State Securities, Inc., the securities attorneys of The White Law Group may be able to help. To speak with a securities attorney, please call the firm’s Chicago office at 312/238-9650.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.
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