Former Stockbroker Raises Over $1.2M from Customers to Remodel His Home
The Securities and Exchange Commission is charging ex-stockbroker Bernard M. Parker with Securities Act of 1933 and Securities Exchange Act of 1934 violations, as well as violations of Rule 10b-5. The regulator says that Parker raised over $1.2M from long-term brokerage customers and others by getting them to think they were buying real estate tax client certificates and would make up to 9% yearly interest.
Instead, says the SEC, Parker only used a small part of that money to buy the liens. He used their other funds to remodel his house, pay his father-in-law’s bills, and make car payments. The agency also claims that the ex-broker conducted the unregistered and fraudulent investment offering using his Parker Financial Services from ’08 to ’14. He also purportedly failed to notify the investment advisory firm and broker-dealer where he was dually registered about his side business.
The Attorney’s Office for the Western District of Pennsylvania has filed criminal charges against Parker in a parallel case over the alleged broker fraud.
Political Intelligence Firm Admits to Compliance Failures
Marwood Group Research LLC has admitted to compliance failures and will settle the SEC’s case against it by paying a $375,000 penalty. According to the Commission, the firm did not properly notify compliance officers about the times that analysts received potential material nonpublic data from government employees.
The firm’s own written policies and procedures are supposed to play a key part in Marwood Group’s efforts to stop nonpublic and confidential data from reaching its clients so as not to influence their decisions regarding securities trading. Yet its misconduct happened in 2013 when analysts were looking for information about pending regulatory approvals and policies at the Food and Drug Administration and the Centers for Medicare & Medicaid Services.
Ex-Goldman Sachs Employee Faces Insider Trading Charges
Yue Han, also known as John Han, is an ex-associate for Goldman Sachs (GS) in its compliance department. He is charged with insider trading. The SEC claims that Han stole nonpublic data from the firms’ email system and used the information to trade ahead of client mergers. He purportedly made over $450K in illicit profits.
The Commission says that Han used the confidential information in e-mails received and sent by Goldman investment bankers whose job was to advise clients about upcoming acquisitions and mergers. He was able to access the emails because of his work, which involved developing surveillance software to monitor other employees to see if they were engaging in possible misconduct, such as insider trading.
Han used the confidential information he got to buy securities in companies about to be acquired. The regulator obtained emergency court order to freeze Han’s assets and the accounts he used to engage in insider trading.
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Read the complaint against Parker (PDF)
Read the complaint against Han (PDF)