FINRA In the Matter of Aegis Capital Corp.

Aegis Capital Corp. allegedly submitted untimely or incomplete restricted period notifications and trading notifications, or failed to submit such notifications, with FINRA in connection with its participation in security distributions that were subject to Regulation M of the Securities Exchange Act of 1934. The firm allegedly submitted a trading notification in connection with the distribution of an actively traded security nine days late and submitted untimely trading notifications in connection with nine other distributions, with some notifications being between one and five days late and others between eleven and 129 days late. In one offering, the firm allegedly failed to submit a trading notification despite being named as a placement agent and receiving compensation. Additionally, the firm purportedly failed to establish and maintain a supervisory system, including written supervisory procedures (WSPs), reasonably designed to achieve compliance with FINRA Rule 5190, specifically regarding the timeliness and accuracy of required notifications. The firm apparently did not describe supervisory reviews to ensure timely and accurate notification submissions, nor were there specific procedures for real-time monitoring of the firm's bidding activity during a distribution's restricted period. In practice, the firm did not conduct reviews of its Regulation M-related notifications. The firm also allegedly made three inaccurate representations in a Corrective Action Statement submitted to FINRA with a 2019 AWC.

Summary generated from official Financial Industry Regulatory Authority press release