Dude, long time no see! 'Cha been up to? Anyway, here's some info on one of the manips in this POS, PGON: " financialcounsel.com
MORE BROKERAGE FIRMS PENALIZED
Several brokerage firms recently have joined Olde Discount in the unenviable
position of having been penalized for customer abuses. These firms are VTR
Capital, Inc. (now known as Fairchild Financial Group, Inc.), Lexington
Capital Corporation (now known as Preston Langley Asset Management), and
Paragon Capital Corporation.
Readers may remember the significant customer abuses that the Securities and
Exchange Commission (SEC) found against Olde Discount. In a consent
decree, the SEC levied substantial fines and suspensions against the firm and
some of its principals (including a $1 million fine and a 12 month suspension
against the firm's very founder and chairman, Ernest Olde). See "SEC case
reveals 'egregious' abuses at brokerage firm", Law Bulletin, 9/25/98. Readers
should remember that Olde Discount has waived certain defenses against
investors filing arbitration claims to recover their investment losses, but
investors must file those claims by March 9, 1999 to receive the special
treatment.
VTR Capital has joined the club of disrepute. In December, the National
Association of Securities Dealers (NASD) censured and fined the brokerage
firm and its former president and owner $100,000. The firm has agreed to pay
$300,000 in restitution and interest to nearly 150 customers in 30 states
including Illinois. The abuse alleged was that the firm participated in an illegal
distribution and fraudulent manipulation of a common stock named Interiors,
Inc. In addition, the NASD alleged that the firm paid additional compensation
to its brokers who used high pressure sales tactics.
In November, Lexington Capital Corporation and its president were censured
and fined $250,000 and ordered to pay more than $200,000 in restitution and
interest to nearly 200 investors. Another broker was fined $100,000. The
NASD alleged that they collaborated to defraud investors and impeded
regulatory scrutiny. Specifically, the firm was charged with violating federal
securities laws when it sold thousands of shares of a penny stock, U.S. Bridge
Corp., to nearly 200 investors without making required risk and suitability
disclosures, and without determining whether the investors were suitable for the
penny stock. Additionally, in the stock of Crown Laboratories, Inc., there
were fraudulent and excessive markups in sales to customers - from 47% to
70%!
The final new member of the club of disrepute is Paragon Capital Corporation.
In November, the NASD censured and fined the brokerage firm and its
president $135,000. The NASD charged that the firm and its president failed
to establish, maintain and enforce required written supervisory procedures
relating to trade reporting, customer limit orders, Small Order Execution
System (SOES), best execution, registration of persons and record keeping.
The NASD and the SEC regularly post results of their prosecutions on their
websites, as well as a host of other information worth reading. |
