FINRA has announced that it has fined Aegis Capital Corp. $950,000 for sales of unregistered penny stocks and anti-money laundering violations. According to FINRA, this fine was also related to supervisory failures within the firm.
The firm was not the only one that FINRA appears to have come down hard upon. Reports show that Charles D. Smulevitz and Kevin C. McKenna, who each served as the firm’s Chief Compliance and AML Compliance Offices were given 30-day and 60-day principal suspensions and fined $5,000 and $10,000, respectively, per FINRA. Aegis’ president, Robert Eide, was also reportedly given a “time-out” in the form of a 15-day suspension for failing to disclosed more than a half-million dollars in outstanding liens, in violation of FINRA rules.
FINRA reportedly found that from April of 2009 through June of 2011, Aegis liquidated almost 4 billion shares of penny stocks which were neither properly registered nor exempted from registration with the US Securities and Exchanges Commission. According to FINRA, Aegis committed these violations in spite of a multitude of “red flags” or warning signs that something was amiss.
This does not appear to be the first time Aegis has come under fire from claims of improper supervision. According to its BrokerCheck Report, Aegis has been the subject of a number of regulatory actions pertaining to violations and failures of its supervisory procedures.
The attorneys at Malecki Law have personally handled cases against broker-dealers like Aegis and others, relating to alleged supervisory failures and other alleged violations of the securities laws and industry rules. If you or a family member lost money with Aegis Capital Corp., contact the securities fraud lawyers at Malecki Law for a free consultation and case evaluation at (212) 943-1233.