FAHN - part 1
MEMBER FIRM: FAHNESTOCK & CO., INC.
BD NUMBER: 249
NASD Member Firm: FAHNESTOCK & CO., INC.
BD Number: 249
12/15/98 SUMMARY INFORMATION
12/15/98: 7/30/98 NASD ARBITRATION
SUBJECT OF AN NASD ARBITRATION. THE ARBITRATION INVOLVED A PUBLIC CUSTOMER
AND WAS FILED BECAUSE OF THE FOLLOWING DISPUTE(S): SUITABILITY; BRCH OF
FIDUCIARY DT. THE AWARD INCLUDED: ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED
BY CUSTOMER-$500,000.00; INTEREST, AMOUNT ASKED BY CUSTOMER-$0.00;
PUNITIVE/EXEMPLARY DAMAGES, AMOUNT ASKED BY CUSTOMER-$0.00; OTHER COSTS,
AMOUNT ASKED BY CUSTOMER-$0.00; ATTORNEY'S FEES, AMOUNT ASKED BY
CUSTOMER-$0.00. RELIEF REQUESTS HAVE BEEN DENIED IN FULL. [NASD ARBITRATION
CASE NO. 95-06034]
12/15/98: 6/26/98 NYSE CENSURE AND FINE
FAHNESTOCK & CO., INC. WAS CENSURED AND FINED $100,000.00 BY THE NYSE AND AN
UNDERTAKING TO RETAIN AN INDEPENDENT CONSULTANT AND IMPLEMENT ITS
RECOMMENDATIONS. FAHNESTOCK & CO., INC. ENTERED AN AGREEMENT WITH THE NEW YORK
STOCK EXCHANGE CONSENTING TO THE FOLLOWING VIOLATIONS: 1.) SEC REGULATION
240.15c3-3(d), PROMULGATED PURSUANT TO THE EXCHANGE ACT, BY FAILING
TO REDUCE SECURITIES IN DEFICIT CONDITION TO ITS POSSESSION OR CONTROL AS
REQUIRED BY THE REGULATION; 2.) SEC REGULATION 240.15c3-3(c)(1), PROMULGATED
PURSUANT TO THE EXCHANGE ACT, BY FAILING TO PROVIDE REQUIRED DOCUMENTATION
SHOWING THAT SECURITIES IN MUTUAL FUND CUSTODY ACCOUNTS WERE NOT SUBJECT TO
LIEN; 3.) SEC REGULATION 240.15c3-3(c)(4), PROMULGATED PURSUANT TO THE
EXCHANGE AT, BY FAILING TO PROVIDE REQUIRED DOCUMENTATION SHOWING THAT
SECURITIES IN FOREIGN CUSTODY ACCOUNTS WERE NOT SUBJECT TO LIEN; 4.) SEC
REGULATION 240.15c3-3(b)(2), PROMULGATED PURSUANT TO THE EXCHANGE ACT, BY
FAILING TO ESTABLISH THAT ITS SEGREGATION SYSTEM WAS NOT CREATING OR
INCREASING DEFICITS; 5.) SEC REGULATION 240.8c-1, PROMULGATED PURSUANT TO THE
EXCHANGE ACT, BY IMPROPERLY CUMMINGLING CUSTOMERS' SECURITIES WITH FIRM
SECURITIES; 6.) FEDERAL RESERVE REGULATION T, 220.4 AND EXCHANGE RULE 431 BY
FAILING TO MARGIN SECURITIES IN CUSTOMER ACCOUNTS AS REQUIRED AND BY
IMPROPERLY EXTENDING CREDIT TO ITS CUSTOMERS; 7.) SECTION 17(a) OF THE
EXCHANGE ACT AND SEC REGULATIONS 240.17a-3 AND FAIING TO MAKE AND KEEP CURRENT
AND PRESERVE CERTAIN OF ITS BOOKS AND RECORDS; 8.) EXCHANGE RULE 410 IN THAT
CERTAIN ORDER TICKETS WERE NOT PROPERLY PREPARED; 9.) EXCHANGE RULE 440b.13,
1
IN THAT CERTAIN SELL ORDER TICKETS WERE NOT MARKED "LONG" OR "SHORT"; 10.)
EXCHANGE RULE 342.11 IN THAT TWO REGISTERED REPRESENTATIVES OPERATED FROM
THEIR RESIDENCES WITHOUT PRIOR EXCHANGE APPROVAL; 11.) EXCHANGE RULE 342 IN
THAT IT FAILED: a) REASONABLY TO SUPERVISE OR CONTROL CERTAIN OF ITS BUSINESS
CONTROLS TO ASSURE COMPLIANCE WITH CERTAIN FINANCIAL AND OPERATIONAL RULES AND
REGULATIONS OF THE EXCHANGE AND THE SEC c) TO ESTABLISH ADEQUATE CONTROLS,
INCLUDING A SYSTEM TO FOLLOW-UP AND REVIEW, TO ASSURE COMPLIANCE WITH RULES
AND REGULATIONS REGARDING CERTAIN CHINESE WALL POLICIES AND PROCEDURES. ****
5/19/98 - UNLESS A REVIEW BY THE NYSE BOARD OF DIRECTORS IS REQUESTED, THIS
DECISION WILL BECOME FINAL 25 CALENDAR DAYS AFTER NOTICE OF THE HEARING
PANEL'S DETERMINATION HAS BEEN SERVED ON THE FIRM.**** **** 6/26/98 - THE
DECISION IS FINAL AND EFFECTIVE IMMEDIATELY.**** [NYSE DOCKET/CASE NO.: HPD
98-48]lm/ba
12/15/98: 6/18/98 NASD CENSURE AND FINE
ACCEPTANCE, WAIVER AND CONSENT; FAHNESTOCK & CO., INC. WAS CENSURED AND FINED
$500 BY THE NASD FOR ALLEGED VIOLATION OR MSRB RULE G-37 IN THAT FIRM FAILED
TO DISCLOSE ON FORMS G-37 NEGOTIATED UNDERWRITINGS IN WHICH IT PARTICIPATED AT
A SYNDICATE MEMBER; AND, FAILED TO TIMELY SUBMIT FORMS G-37. [NASD COMPLAINT
NO. C10970151] jm
12/15/98: 6/04/98 NASD ARBITRATION
SUBJECT OF AN NASD ARBITRATION. THE ARBITRATION INVOLVED A PUBLIC CUSTOMER
AND WAS FILED BECAUSE OF THE FOLLOWING DISPUTE(S): CHURNING; SUITABILITY;
ACCOUNT RELATED - FAILURE TO SUPERVISE; BRCH OF FIDUCIARY DT. THE AWARD
INCLUDED: ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED BY CUSTOMER-$515,000.00;
PUNITIVE/EXEMPLARY DAMAGES, AMOUNT ASKED BY CUSTOMER-$0.00; INTEREST, AMOUNT
ASKED BY CUSTOMER-$0.00; ATTORNEY'S FEES, AMOUNT ASKED BY CUSTOMER-$0.00;
OTHER COSTS, AMOUNT ASKED BY CUSTOMER-$0.00. RELIEF REQUESTS HAVE BEEN
DENIED IN FULL. [NASD ARBITRATION CASE NO. 97-04204]
12/15/98: 3/24/98 NASD ARBITRATION
SUBJECT OF AN NASD ARBITRATION. THE ARBITRATION INVOLVED A PUBLIC CUSTOMER
AND WAS FILED BECAUSE OF THE FOLLOWING DISPUTE(S): UNAUTHORIZED TRADING; BRCH
OF FIDUCIARY DT; ACCOUNT RELATED - FAILURE TO SUPERVISE; CHURNING. THE AWARD
INCLUDED: ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED BY CUSTOMER-$254,190.00;
PUNITIVE/EXEMPLARY DAMAGES, AMOUNT ASKED BY CUSTOMER-$0.00; INTEREST, AMOUNT
ASKED BY CUSTOMER-$0.00; OTHER COSTS, AMOUNT ASKED BY CUSTOMER-$0.00. RELIEF
REQUESTS HAVE BEEN DENIED IN FULL. [NASD ARBITRATION CASE NO. 96-05303]
2
12/15/98: 1/07/98 NASD ARBITRATION
SUBJECT OF AN NASD ARBITRATION. THE ARBITRATION INVOLVED A PUBLIC CUSTOMER
AND WAS FILED BECAUSE OF THE FOLLOWING DISPUTE(S): UNAUTHORIZED TRADING;
SUITABILITY; MISREPRESENTATION; MISREPRESENTATION. THE AWARD INCLUDED:
ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED BY CUSTOMER-$200,000.00;
PUNITIVE/EXEMPLARY DAMAGES, AMOUNT ASKED BY CUSTOMER-$0.00; ATTORNEY'S FEES,
AMOUNT ASKED BY CUSTOMER-$0.00. RELIEF REQUESTS HAVE BEEN DENIED IN FULL.
[NASD ARBITRATION CASE NO. 92-02683]
12/15/98: 11/26/97 NASD ARBITRATION
SUBJECT OF AN NASD ARBITRATION. THE ARBITRATION INVOLVED A PUBLIC CUSTOMER
AND WAS FILED BECAUSE OF THE FOLLOWING DISPUTE(S): SUITABILITY; BRCH OF
FIDUCIARY DT; ACCOUNT RELATED-BREACH OF CONTRACT; ACCOUNT RELATED - FAILURE
TO SUPERVISE. THE AWARD INCLUDED: ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED
BY CUSTOMER-$0.00; ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED BY
CUSTOMER-$0.00; ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED BY CUSTOMER-$0.00;
PUNITIVE/EXEMPLARY DAMAGES, AMOUNT ASKED BY CUSTOMER-$0.00;
PUNITIVE/EXEMPLARY DAMAGES, AMOUNT ASKED BY CUSTOMER-$0.00;
PUNITIVE/EXEMPLARY DAMAGES, AMOUNT ASKED BY CUSTOMER-$0.00; INTEREST, AMOUNT
ASKED BY CUSTOMER-$0.00; INTEREST, AMOUNT ASKED BY CUSTOMER-$0.00; INTEREST,
AMOUNT ASKED BY CUSTOMER-$0.00; INTEREST, AMOUNT ASKED BY CUSTOMER-$0.00;
ATTORNEY'S FEES, AMOUNT ASKED BY CUSTOMER-$0.00; ATTORNEY'S FEES, AMOUNT
ASKED BY CUSTOMER-$0.00; ATTORNEY'S FEES, AMOUNT ASKED BY CUSTOMER-$0.00;
ATTORNEY'S FEES, AMOUNT ASKED BY CUSTOMER-$0.00; OTHER COSTS, AMOUNT ASKED BY
CUSTOMER-$0.00; OTHER COSTS, AMOUNT ASKED BY CUSTOMER-$0.00; OTHER COSTS,
AMOUNT ASKED BY CUSTOMER-$0.00; OTHER COSTS, AMOUNT ASKED BY CUSTOMER-$0.00;
ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED BY CUSTOMER-$199,666.00;
ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED BY CUSTOMER-$199,666.00. RELIEF
REQUESTS HAVE BEEN DENIED IN FULL. [NASD ARBITRATION CASE NO. 95-04858] |
