FINRA Issues $1.3 Million Penalty To Advisor Group Over Private Placement Sales

Posted on December 15th, 2022 at 3:32 PM
FINRA Issues $1.3 Million Penalty To Advisor Group Over Private Placement Sales

From the Desk of Jim Eccleston at Eccleston Law.

The Financial Industry Regulatory Authority (FINRA) has issued a $1.3 million fine to the four Advisor Group firms, FSC Securities, Royal Alliance Associates, SagePoint Financial, and Woodbury Financial Services, for selling private placements issued by GPB Capital Holdings.

Advisor Group neglected to inform investors that GPB had failed to timely submit its required filings with the Securities and Exchange Commission (SEC) in 2018, including audited financial statements, according to FINRA. The GPB fund that failed to file its 2018 audited financial statements was the $600 million GPB Automotive Portfolio limited partnership, according to FINRA.

FINRA further alleges that advisors at each of the four Advisor Group firms sold a total of $16.3 million in private placements, which generated nearly $1.14 million in commissions, even after the firms knew about GPB’s failure to make its required filings. Each of the four Advisor Group firms agreed to the penalty, which includes $200,000 in total fines and $1.1 million in restitution, without admitting or denying any of FINRA’s investigatory findings.

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, finra

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