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Cantor Fitzgerald, Brokers Consent to Fine Regarding Microcap Securities

By December 22, 2015September 20th, 2017News

According to a Letter of Acceptance, Waiver, and Consent (“AWC”) with FINRA [Case No. 2012034964301], Cantor Fitzgerald & Co. consented to a public censure, a fine of $6 million, and disgorgement of commissions of $1.2 million to settle FINRA allegations that it sold unregistered shares of microcap securities and failed to establish, maintain, and enforce a supervisory system reasonably designed to achieve compliance with industry rules.

Broker Joseph Ludovico agreed to a 2-month suspension from the securities industry and a fine in the amount of $25,000; and broker and Cantor Fitzgerald supervisor Jarred Kessler agreed to a 3-month suspension from the securities industry and a fine in the amount of $35,000.

FINRA alleged that from March 2011 through at least September 2012, Cantor Fitzgerald failed to adequately supervise the supervise the sales of microcap securities and sold more than 73.6 billion shares of them without conducting adequate due diligence.  A portion of these securities were not registered with the Securities & Exchange Commission.  Ludovico sold the securities at issue, and Kessler ultimately supervised the sales at issue.

Microcap securities include securities that trade at less than $5 per share and are quoted over-the-counter. For a detailed description of penny stocks, visit the SEC’s website.

Fishman Haygood represents investors who have suffered investment losses in claims against their brokers or financial advisors. Our experienced attorneys have brought securities fraud cases in state and federal courts across the nation, as well as in FINRA arbitration. We work to help investors recoup their losses.

Of course, all cases are different. For that reason, we analyze each client’s matter individually and provide our personalized evaluation only after considering all of the facts and circumstances of all possible claims. If you or someone you know is the victim of securities fraud, please contact a Fishman Haygood lawyer today.

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