Firm Suspended Schneider Securities, Inc. (CRD #16434, Denver Colorado) submitted an Offer of
Settlement in which the firm was suspended from all trading activities for two
years. In light of the financial status of the firm, no monetary sanctions have
been imposed. Without admitting or denying the allegations, the firm consented
to the described sanction and to the entry of findings that it transmitted to
the NASDAQ Stock Market, Inc., through the Automated Confirmation Transaction
ServiceSM (ACTSM), last-sale reports of fictitious transactions in a NASDAQ
National Market® (NNM) security. The findings also stated that the firm reported
these fictitious transactions in an NNM security with the intent to cause the
market for the stock to attain a higher price. NASD also found that the firm
engaged in a manipulative, deceptive, and/or fraudulent conduct by intentionally
or recklessly causing to be reported to the NASDAQ Stock Market, Inc., last-sale
reports of transactions in a common stock for the purpose of affecting the price
in the security. In addition, NASD found that the firm published and circulated,
or caused to be published and circulated, communications through last-sale
reports to ACT of fictitious transactions in a common stock that the firm did
not believe were bona fide purchases or sales. Furthermore, the findings stated
that the firm failed to establish, maintain, or enforce procedures reasonably
designed to ensure that it reported only bona fide transactions in the last-sale
reports it reported to the NASDAQ Stock Market, Inc., through ACT. The findings
also included that the firm failed to have in place procedures to adequately
review trades reported to ACT, or to ensure that its employee did not report
fictitious trades to ACT.
The firm’s suspension began July 21, 2003, and will conclude at the close of
business July 20, 2005. (NASD Case #CMS030001)
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