MAXIM GROUP LLC · MAXIM GROUP LLC SEC# 120708 8-65337 Main Office Location Mailing Address...

BrokerCheck Report

MAXIM GROUP LLC

Section Title

Report Summary

Firm History

CRD# 120708

1

13

Firm Profile 2 - 12

Page(s)

Firm Operations 14 - 20

Disclosure Events 21

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MAXIM GROUP LLC

CRD# 120708

SEC# 8-65337

Main Office Location

405 LEXINGTON AVENUENEW YORK, NY 10174Regulated by FINRA New York Office

Mailing Address

405 LEXINGTON AVENUENEW YORK, NY 10174

Business Telephone Number

212-895-3500

Report Summary for this Firm

This report summary provides an overview of the brokerage firm. Additional information for this firm can be foundin the detailed report.

Disclosure Events

Brokerage firms are required to disclose certaincriminal matters, regulatory actions, civil judicialproceedings and financial matters in which the firm orone of its control affiliates has been involved.

Are there events disclosed about this firm? Yes

The following types of disclosures have beenreported:

Type Count

Regulatory Event 27

Arbitration 1

Firm Profile

This firm is classified as a limited liability company.

This firm was formed in New York on 04/11/2002.

Its fiscal year ends in December.

Firm History

Information relating to the brokerage firm's historysuch as other business names and successions(e.g., mergers, acquisitions) can be found in thedetailed report.

Firm Operations

Is this brokerage firm currently suspended with anyregulator? No

This firm conducts 16 types of businesses.

This firm is affiliated with financial or investmentinstitutions.

This firm has referral or financial arrangements withother brokers or dealers.

This firm is registered with:

• the SEC• 4 Self-Regulatory Organizations• 53 U.S. states and territories

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1©2020 FINRA. All rights reserved. Report about MAXIM GROUP LLC


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This firm is classified as a limited liability company.

This firm was formed in New York on 04/11/2002.

CRD#

This section provides the brokerage firm's full legal name, "Doing Business As" name, business and mailingaddresses, telephone number, and any alternate name by which the firm conducts business and where such name isused.

Firm Profile

Firm Names and Locations

Its fiscal year ends in December.

MAXIM GROUP LLC

SEC#

120708

8-65337

Main Office Location

Mailing Address

Business Telephone Number

Doing business as MAXIM GROUP LLC

212-895-3500

Regulated by FINRA New York Office



Other Names of this Firm

Name Where is it used

M-VEST (A WHOLLY OWNED DIVISION OF MAXIM GROUP) AK, AL, AR, AZ, CA,CO, CT, DC, DE, FL,GA, HI, IA, ID, IL, IN,KS, KY, LA, MA, MD,ME, MI, MN, MO,MS, MT, NC, ND, NE,NH, NJ, NM, NV, NY,OH, OK, OR, PA, PR,RI, SC, SD, TN, TX,UT, VA, VI, VT, WA,WI, WV, WY






MAXIM MERCHANT CAPITAL (A WHOLLY OWNED DIVISION OFMAXIM GROUP

AK, AL, AR, AZ, CA,CO, CT, DC, DE, FL,GA, HI, IA, ID, IL, IN,KS, KY, LA, MA, MD,ME, MI, MN, MO,MS, MT, NC, ND, NE,NH, NJ, NM, NV, NY,OH, OK, OR, PA, PR,RI, SC, SD, TN, TX,UT, VA, VI, VT, WA,WI, WV, WY





This section provides information relating to all direct owners and executive officers of the brokerage firm.

Direct Owners and Executive Officers

Firm Profile

Position

Percentage of Ownership

Is this a public reportingcompany?

Position Start Date

Does this owner direct themanagement or policies ofthe firm?

MAXIM PARTNERS LLC

MEMBER

75% or more

No

Domestic Entity

04/2002

Yes

Is this a domestic or foreignentity or an individual?

Legal Name & CRD# (if any):

Position



Position Start Date


MJR INC.

MEMBER

5% but less than 10%

No

Domestic Entity

10/2002

No



Position


Position Start Date


DICLEMENTE, ANTHONY

CHIEF ADMINISTRATIVE OFFICER

Less than 5%

Individual

01/2019

No

1673140








Direct Owners and Executive Officers (continued)

Firm Profile



No

No

Position



Position Start Date


EVANS, TIPTON

CHIEF COMPLIANCE OFFICER

Less than 5%

No

Individual

09/2019

Yes

6118339



Position



Position Start Date


FIORE, CHRISTOPHER JAMES

PRESIDENT, DIRECTOR OF CAPITAL MARKETS

Less than 5%

No

Individual

01/2010

No

2269479



GREENBAUM, LEONARD ALLEN

Individual

804886









Firm Profile

Position



Position Start Date


DIRECTOR OF OPTIONS TRADING

Less than 5%

No

Individual

10/2002

No


Position



Position Start Date


LAROSA, PAUL GEORGE

HEAD OF SYNDICATE/ACTING DIRECTOR OF ASSET MANAGEMENT

Less than 5%

No

Individual

01/2009

No

1900695



Position


Position Start Date


MESSINGER, MICHAEL SPENCER

MSP

Less than 5%

Individual

12/2013

No

1403506









Firm Profile



No

No

Position



Position Start Date


MURPHY, TIMOTHY GERARD

FINOP/CFO

Less than 5%

No

Individual

04/2002

Yes

1836629



Position



Position Start Date


RABINOWITZ, MICHAEL

CHAIRMAN, CEO

Less than 5%

No

Individual

04/2002

Yes

1141255



ROSE, EDWARD LAWRENCE

Individual

1791912









Firm Profile

Position



Position Start Date


GENERAL COUNSEL

Less than 5%

No

Individual

04/2002

Yes


Position



Position Start Date


SERGIO, JOHN PETER

CHIEF OPERATING OFFICER/CHIEF OPERATIONS OFFICER

Less than 5%

No

Individual

04/2004

Yes

1474341



Position


Position Start Date


TELLER, CLIFFORD ADAM MR.

DIRECTOR OF CORPORATE FINANCE

Less than 5%

Individual

01/2006

No

4631188









Firm Profile



No

No

Position



Position Start Date


TERRANOVA, JAMIE MICHAEL

HEAD OF FIXED INCOME SALES

Less than 5%

No

Individual

05/2010

No

4465828



Position



Position Start Date


VENDETTI, ANTHONY V

DIRECTOR OF RESEARCH

Less than 5%

No

Individual

02/2005

No

2574608



VITALE, WILLIAM CHRISTIAN

Individual

2669953









Firm Profile

Position



Position Start Date


DIRECTOR OF TRADING

Less than 5%

No

Individual

09/2008

No


Position



Position Start Date


ZAPPONE, FRANCO VINCENT

BRANCH OFFICER OF WOODBURY OFFICE

Less than 5%

No

Individual

01/2018

No

1864009








This section provides information relating to any indirect owners of the brokerage firm.

Indirect Owners

Firm Profile

MJR HOLDINGS LLC

MEMBER

MAXIM PARTNERS


No

Domestic Entity

05/2002

Yes



Company through whichindirect ownership isestablished

Relationship to Direct Owner

Relationship Established




RABINOWITZ, MICHAEL

MEMBER

MJR HOLDINGS LLC


No

Individual

05/2002

Yes

1141255









RABINOWITZ, MICHAEL

Individual

1141255








Indirect Owners (continued)

Firm Profile

MEMBER

MJR INC.


No

Individual

10/2002

Yes








ROSE, EDWARD LAWRENCE

MEMBER

MJR INC.


No

Individual

10/2002

Yes

1791912














Firm History

This section provides information relating to any successions (e.g., mergers, acquisitions) involving the firm.

No information reported.






Firm Operations

RegistrationsThis section provides information about the regulators (Securities and Exchange Commission (SEC), self-regulatoryorganizations (SROs), and U.S. states and territories) with which the brokerage firm is currently registered andlicensed, the date the license became effective, and certain information about the firm's SEC registration.

This firm is currently registered with the SEC, 4 SROs and 53 U.S. states and territories.

SEC Registration Questions

This firm is registered with the SEC as:

A broker-dealer:

A broker-dealer and government securities broker or dealer:

A government securities broker or dealer only:

This firm has ceased activity as a government securities broker or dealer:

Yes

Yes

No

No

Federal Regulator Status Date Effective

SEC Approved 09/25/2002

Self-Regulatory Organization Status Date Effective

FINRA Approved 09/25/2002

Investors' Exchange LLC Approved 08/15/2016

NYSE Arca, Inc. Approved 03/19/2003

Nasdaq Stock Market Approved 07/12/2006






Firm Operations

Registrations (continued)

U.S. States &Territories

Status Date Effective

Alabama Approved 10/09/2002

Alaska Approved 10/10/2002

Arizona Approved 09/26/2002

Arkansas Approved 09/26/2002

California Approved 10/07/2002

Colorado Approved 10/29/2002

Connecticut Approved 10/17/2002

Delaware Approved 10/09/2002

District of Columbia Approved 08/16/2002

Florida Approved 10/09/2002

Georgia Approved 10/07/2002

Hawaii Approved 10/02/2002

Idaho Approved 10/01/2002

Illinois Approved 09/26/2002

Indiana Approved 10/09/2002

Iowa Approved 10/01/2002

Kansas Approved 10/08/2002

Kentucky Approved 09/26/2002

Louisiana Approved 10/10/2002

Maine Approved 11/28/2004

Maryland Approved 10/08/2002

Massachusetts Approved 10/17/2002

Michigan Approved 10/07/2002

Minnesota Approved 09/26/2002

Mississippi Approved 10/07/2002

Missouri Approved 10/25/2002

Montana Approved 10/11/2002

Nebraska Approved 10/07/2002

Nevada Approved 10/07/2002

New Hampshire Approved 11/15/2002

New Jersey Approved 10/21/2002

New Mexico Approved 10/02/2002

New York Approved 07/12/2002

U.S. States &Territories

Status Date Effective

North Carolina Approved 10/08/2002

North Dakota Approved 09/27/2002

Ohio Approved 10/09/2002

Oklahoma Approved 09/26/2002

Oregon Approved 10/10/2002

Pennsylvania Approved 09/26/2002

Puerto Rico Approved 09/26/2002

Rhode Island Approved 10/07/2002

South Carolina Approved 10/08/2002

South Dakota Approved 10/04/2002

Tennessee Approved 10/18/2002

Texas Approved 07/31/2002

Utah Approved 10/04/2002

Vermont Approved 10/09/2002

Virgin Islands Approved 03/30/2005

Virginia Approved 10/07/2002

Washington Approved 09/27/2002

West Virginia Approved 09/26/2002

Wisconsin Approved 09/30/2002

Wyoming Approved 09/26/2002






Firm Operations

Types of BusinessThis section provides the types of business, including non-securities business, the brokerage firm is engaged in orexpects to be engaged in.

Other Types of Business

This firm does not effect transactions in commodities, commodity futures, or commodity options.This firm does engage in other non-securities business.

Non-Securities Business Description: THE FIRM SELLS NON-VARIABLE INSURANCE PRODUCTS INCLUDINGSTRAIGHT LIFE, ACCIDENT AND HEALTH INSURANCE.

This firm currently conducts 16 types of businesses.

Types of Business

Broker or dealer making inter-dealer markets in corporation securities over-the-counter

Broker or dealer retailing corporate equity securities over-the-counter

Broker or dealer selling corporate debt securities

Underwriter or selling group participant (corporate securities other than mutual funds)

Mutual fund retailer

U S. government securities dealer

U S. government securities broker

Municipal securities dealer

Municipal securities broker

Broker or dealer selling variable life insurance or annuities

Put and call broker or dealer or option writer

Non-exchange member arranging for transactions in listed securities by exchange member

Trading securities for own account

Private placements of securities

Broker or dealer selling interests in mortgages or other receivables

Other - THE FIRM WILL PERFORM CONSULTING SERVICES IN CONNECTION WITH TRANSACTIONSINCLUDING MERGERS AND ACQUISITIONS, RESTRUCTURINGS, AND DIVESTITURES. AS PART OF THESETRANSACTIONS, THE FIRM WILL PROVIDE OPINION LETTERS AND VALUATIONS, AND ASSIST INNEGOTIATING WITH OTHER PARTIES. THE FIRM ALSO PUBLISHES RESEARCH REPORTS.






Firm Operations

Clearing Arrangements

This firm does not hold or maintain funds or securities or provide clearing services for other broker-dealer(s).

Introducing Arrangements

This firm does refer or introduce customers to other brokers and dealers.

Name: PERSHING LLC

Business Address: ONE PERSHING PLAZAJERSEY CITY, NJ 07399

CRD #: 7560

Effective Date: 09/14/2005

Description: THE FIRM WILL INTRODUCE CUSTOMER ACCOUNTS ON A FULLY-DISCLOSED BASIS TO PERSHING LLC.






Firm Operations

Industry Arrangements

This firm does have books or records maintained by a third party.

This firm does not have accounts, funds, or securities maintained by a third party.

This firm does not have customer accounts, funds, or securities maintained by a third party.

This firm does not have individuals who control its management or policies through agreement.

This firm does not have individuals who wholly or partly finance the firm's business.

Control Persons/Financing

Name: OMGEO LLC

Business Address: 22 THOMPSON PLACEBOSTON, MA 02210


Description: THE FIRM HAS ENTERED INTO ARRANGEMENT WITH OMGEO LLC AS ATHIRD PARTY RECORDKEEPER FOR TRADESUITE CONFIRMATIONS.

Name: PERSHING LLC

Business Address: ONE PERSHING PLAZAJERSEY CITY, NJ 07399

CRD #: 7560


Description: THE FIRM HAS ENTERED INTO A FULLY-DISCLOSED CLEARINGAGREEMENT WITH PERSHING LLC WHICH CLEARS ALL TRANSACTIONSAND CARRIES THE FIRM'S CUSTOMERS' ACCOUNTS AND THE FIRM'SACCOUNTS. THEREFORE, PERSHING LLC WILL HAVE CUSTODY OFCERTAIN RECORDS OF THE FIRM.






Firm Operations

Organization AffiliatesThis section provides information on control relationships the firm has with other firms in the securities, investmentadvisory, or banking business.

This firm is, directly or indirectly:

· in control of· controlled by· or under common control withthe following partnerships, corporations, or other organizations engaged in the securities or investmentadvisory business.

No

Yes

No

05/04/2018

405 LEXINGTON AVE - 2ND FLOORNEW YORK, NY 10174

297463

M VEST LLC is under common control with the firm.

MAXIM GROUP LLC IS SPINNING OFF M VEST AND BOTH ENTITIES AREUNDER THE COMMON CONTROL OF MAXIM PARTNERS LLC.

Description:

Investment AdvisoryActivities:

Securities Activities:

Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:

Yes

No

No

12/22/2005

20 CROSSWAYS PARK DRIVE NORTH - SUITE 304WOODBURY, NY 11797

139366

MAXIM FINANCIAL ADVISORS LLC is under common control with the firm.

MAXIM GROUP LLC IS THE BROKER/DEALER EXECUTING TRADES FORMAXIM FINANCIAL ADVISORS, THE INVESTMENT ADVISOR. BOTH MAXIMGROUP LLC AND MAXIM FINANCIAL ADVISORS LLC ARE UNDER COMMONCONTROL BY MAXIM PARTNERS LLC.

Description:

Investment AdvisoryActivities:

Securities Activities:

Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:






Firm Operations

Organization Affiliates (continued)MAXIM GROUP LLC IS THE BROKER/DEALER EXECUTING TRADES FORMAXIM FINANCIAL ADVISORS, THE INVESTMENT ADVISOR. BOTH MAXIMGROUP LLC AND MAXIM FINANCIAL ADVISORS LLC ARE UNDER COMMONCONTROL BY MAXIM PARTNERS LLC.

This firm is not directly or indirectly, controlled by the following:

· bank holding company· national bank· state member bank of the Federal Reserve System· state non-member bank· savings bank or association· credit union· or foreign bank






Disclosure Events

All firms registered to sell securities or provide investment advice are required to disclose regulatory actions, criminal orcivil judicial proceedings, and certain financial matters in which the firm or one of its control affiliates has been involved.For your convenience, below is a matrix of the number and status of disclosure events involving this brokerage firm orone of its control affiliates. Further information regarding these events can be found in the subsequent pages of thisreport.

Final On AppealPending

Regulatory Event 0 27 0

Arbitration N/A 1 N/A






Disclosure Event Details

What you should know about reported disclosure events:

1. BrokerCheck provides details for any disclosure event that was reported in CRD. It also includessummary information regarding FINRA arbitration awards in cases where the brokerage firm wasnamed as a respondent.

2. Certain thresholds must be met before an event is reported to CRD, for example: o A law enforcement agency must file formal charges before a brokerage firm is required to disclose a

particular criminal event.3. Disclosure events in BrokerCheck reports come from different sources:

o Disclosure events for this brokerage firm were reported by the firm and/or regulators. When the firmand a regulator report information for the same event, both versions of the event will appear in theBrokerCheck report. The different versions will be separated by a solid line with the reporting sourcelabeled.

4. There are different statuses and dispositions for disclosure events: o A disclosure event may have a status of pending, on appeal, or final.

§ A "pending" event involves allegations that have not been proven or formally adjudicated.§ An event that is "on appeal" involves allegations that have been adjudicated but are currently

being appealed.§ A "final" event has been concluded and its resolution is not subject to change.

o A final event generally has a disposition of adjudicated, settled or otherwise resolved.§ An "adjudicated" matter includes a disposition by (1) a court of law in a criminal or civil matter,

or (2) an administrative panel in an action brought by a regulator that is contested by the partycharged with some alleged wrongdoing.

§ A "settled" matter generally involves an agreement by the parties to resolve the matter.Please note that firms may choose to settle customer disputes or regulatory matters forbusiness or other reasons.

§ A "resolved" matter usually involves no payment to the customer and no finding ofwrongdoing on the part of the individual broker. Such matters generally involve customerdisputes.

5. You may wish to contact the brokerage firm to obtain further information regarding any of thedisclosure events contained in this BrokerCheck report.

Regulatory - Final

This type of disclosure event involves (1) a final, formal proceeding initiated by a regulatory authority (e.g., a statesecurities agency, self-regulatory organization, federal regulator such as the U.S. Securities and Exchange Commission,foreign financial regulatory body) for a violation of investment-related rules or regulations; or (2) a revocation orsuspension of the authority of a brokerage firm or its control affiliate to act as an attorney, accountant or federalcontractor.

Disclosure 1 of 27

Reporting Source: Regulator

Allegations: A MINOR RULE VIOLATION AGAINST THE FIRM WAS ISSUED ON DECEMBER13, 2019 IN WHICH THE FIRM FAILED TO REGISTER TWO EMPLOYEES ASGENERAL SECURITIES PRINCIPLES AND ONE EMPLOYEE AS A FINANCIALAND OPERATIONS PRINCIPAL WITH THE EXCHANGE. THE FINDINGSSTATED THAT THE FIRM FAILED TO SUPERVISE ITS ASSOCIATED PERSONSTO ENSURE COMPLIANCE WITH THE REGISTRATION REQUIREMENTS OFNYSE ARCA.

Current Status: Final






Initiated By: NYSE ARCA, INC.

Principal Sanction(s)/ReliefSought:

Other Sanction(s)/ReliefSought:

Date Initiated: 12/13/2019

Docket/Case Number: 2018056487802

Principal Product Type: No Product

Other Product Type(s):

Allegations: A MINOR RULE VIOLATION AGAINST THE FIRM WAS ISSUED ON DECEMBER13, 2019 IN WHICH THE FIRM FAILED TO REGISTER TWO EMPLOYEES ASGENERAL SECURITIES PRINCIPLES AND ONE EMPLOYEE AS A FINANCIALAND OPERATIONS PRINCIPAL WITH THE EXCHANGE. THE FINDINGSSTATED THAT THE FIRM FAILED TO SUPERVISE ITS ASSOCIATED PERSONSTO ENSURE COMPLIANCE WITH THE REGISTRATION REQUIREMENTS OFNYSE ARCA.

Resolution Date: 12/13/2019

Resolution:

Other Sanctions Ordered:

Sanction Details: THE FIRM WAS FINED A TOTAL OF $4,500 ($1,000 FOR ITS REGISTRATIONVIOLATIONS AND $3,500 FOR ITS SUPERVISION VIOLATION).

Regulator Statement BECAUSE ONE OR MORE OF THE INDIVIDUAL FINE(S) BEING IMPOSEDEXCEEDS $2,500, SUCH FINE IS REQUIRED TO BE REPORTED BY THE FIRMON THE FORM BD. A FAILURE TO REPORT THE FINE(S) ON THE FORM BDCOULD SUBJECT THE FIRM TO FURTHER DISCIPLINARY ACTION.MOREOVER, SUCH FINE WILL ALSO BE REPORTED BY NYSE ARCA, NYSEREGULATION AND/OR FINRA TO THE SECURITIES AND EXCHANGECOMMISSION UNDER RULE L9D-1 OF THE SECURITIES EXCHANGE ACT OF1934.

Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?

No

Sanctions Ordered: Monetary/Fine $3,500.00

Other

i23©2020 FINRA. All rights reserved. Report about MAXIM GROUP LLC





iReporting Source: Firm








Allegations: A MINOR RULE VIOLATION AGAINST THE FIRM WAS ISSUED ON DECEMBER13,2019 IN WHICH THE FIRM FAILED TO REGISTER TWO EMPLOYEES ASGENERAL SECURITIES PRINCIPLES AND ONE EMPLOYEE AS A FINANCIALAND OPERATIONS PRINCIPAL WITH THE EXCHANGE. THE FINDINGSSTATED THAT THE FIRM FAILED TO REGISTER ITS ASSOCIATED PERSONSTO ENSURE COMPLIANCE WITH THE REGISTRATION REQUIREMENTS OFNYSE ARCA.



Resolution:


Sanction Details: THE FIRM WAS FINED A TOTAL OF $4500.00 ($1000.00 FOR ITSREGISTRATION VIOLATIONS AND $3500.00 FOR ITS SUPERVISIONVIOLATION).


Other

Disclosure 2 of 27

i


Allegations: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLC("MAXIM" OR "FIRM") CONSENTED TO THE SANCTIONS AND TO THE ENTRYOF FINDINGS THAT IT FAILED TO ESTABLISH, DOCUMENT, AND MAINTAIN ASYSTEM OF RISK MANAGEMENT CONTROLS AND SUPERVISORYPROCEDURES, REASONABLY DESIGNED TO MANAGE THE FINANCIAL ANDREGULATORY RISK OF ITS BUSINESS ACTIVITY. THUS, IN VIOLATION OFTHE SECURITIES EXCHANGE ACT OF 1934 (RULE 15C3-5 OR MARKETACCESS RULE). MAXIM FAILED TO SATISFY RULE 15C3-5 CREDIT LIMITREQUIREMENTS BY FAILING TO APPLY CREDIT LIMITS TO ANY OF ITSINSTITUTIONAL CUSTOMERS AND FAILING TO MAINTAIN ANYDOCUMENTATION, INCLUDING WRITTEN SUPERVISORY PROCEDURES(WSPS), RELATED TO CREDIT LIMITS. THEREFORE, TO PREVENT THEENTRY OF ORDERS EXCEEDING APPROPRIATE PRE-SET CREDITTHRESHOLDS. THE FINDINGS STATED THAT MAXIM DID NOT EMPLOYCONTROLS AND PROCEDURES REASONABLY DESIGNED TO POTENTIALLYPREVENT ERRONEOUS ORDERS. MAXIM DID NOT UTILIZE A REASONABLEAVERAGE DAILY VOLUME (ADV) CONTROL LIMIT. THE ERRONEOUS ORDERCONTROLS MAXIM IMPLEMENTED WERE SOFT LIMITS, RATHER THANHARD BLOCKS. IN ADDITION, THE FIRM FAILED TO PROVIDE EVIDENCETHAT IT TRAINED OR SUPERVISED ITS TRADERS WITH RESPECT TO THEOVERRIDING OF SUCH LIMITS, AND FAILED TO MAINTAIN ANY RECORDSOF WHEN FIRM TRADERS BYPASSED SUCH SOFT BLOCKS. THE FINDINGSALSO STATED THAT MAXIM VIOLATED THE MARKET ACCESS RULE BY NOTHAVING A SPOOFING OR LAYERING REVIEW. FINRA FOUND THAT MAXIM'SWSPS FAILED TO DESCRIBE IN SUFFICIENT DETAIL HOW THE FIRMSHOULD CONDUCT ITS MANDATED ANNUAL REVIEW. MOREOVER, MAXIMFAILED TO PROVIDE EVIDENCE THAT IT REVIEWED THE EFFECTIVENESSOR THE REASONABLENESS OF ITS ERRONEOUS ORDER CONTROLS ORITS CREDIT LIMITS. A REASONABLE MARKET ACCESS RULE ANNUALREVIEW SHOULD HAVE IDENTIFIED THE DEFICIENCIES NOTED ABOVE,INCLUDING INSTITUTIONAL CUSTOMERS TRADING WITHOUT PRE-TRADECREDIT THRESHOLDS. FINRA ALSO FOUND THAT THE FIRM FAILED TOESTABLISH AND MAINTAIN WSPS AND A SUPERVISORY SYSTEMREASONABLY DESIGNED TO DETECT AND PREVENT POTENTIALLYMANIPULATIVE TRADING AND ACHIEVE COMPLIANCE WITH THESECURITIES EXCHANGE ACT OF 1934 (RULE 15C3-5 OR MARKET ACCESSRULE). MAXIM DID NOT HAVE WRITTEN PROCEDURES RELATED TOCREDIT LIMITS, AND FAILED TO APPLY CREDIT LIMITS TO ANY OF ITSCUSTOMERS. MAXIM FAILED TO DOCUMENT ITS PROCESS FOR SETTINGITS ERRONEOUS ORDER CONTROLS OR THE METHODOLOGY USED TODETERMINE FUNCTIONAL AND APPROPRIATE ERRONEOUS ORDERCONTROLS, AND FAILED TO DETAIL ITS PROCESS FOR EVALUATING ANDREVIEWING CONTROL LIMITS AND PROCEDURES. IN ADDITION, FINRADETERMINED THAT MAXIM'S WSPS DID NOT INCLUDE METHODS FORSUPERVISING CLIENT TRADING. WHILE THE FIRM DID HAVE CERTAINPOST-TRADE SURVEILLANCES IN PLACE, THE WSPS DID NOT IN ALLINSTANCES STATE HOW EACH REVIEW ASSOCIATED WITH TRADINGACTIVITY SHOULD BE CONDUCTED OR HOW ISSUES SHOULD BEESCALATED. THE WSPS ALSO FAILED TO DOCUMENT THE BASIS FORPARTICULAR CONTROL LIMITS, AND FAILED TO DETAIL THE FIRM'SPROCESS FOR EVALUATING AND REVIEWING CONTROL LIMITS ANDPROCEDURES. ADDITIONALLY, THE FIRM'S WSPS FAILED TO SPECIFY THECONTROLS AND PROCEDURES THE FIRM UNDERTOOK TO ENSURE POST-TRADE EXECUTION REPORTS WERE AVAILABLE IMMEDIATELY TOSURVEILLANCE PERSONNEL, AND FAILED TO DETAIL THE FIRM'S PROCESSFOR EVALUATING AND REVIEWING CONTROL LIMITS AND PROCEDURES.MOREOVER, AS PREVIOUSLY DISCUSSED, THE FIRM FAILED TO CONDUCTANY SUPERVISION FOR SPOOFING AND LAYERING. MAXIM'S WSPS DIDNOT SPECIFY THE MANNER IN WHICH ANNUAL REVIEW OF MARKETACCESS CONTROLS SHOULD BE CONDUCTED. THE FIRM DID NOT REVIEWWHETHER THE CONTROLS WERE APPROPRIATE OR EFFECTIVE GIVENTHE FIRM'S BUSINESS, AND THE FIRM DID NOT CONDUCT A REVIEWRELATED TO CREDIT LIMITS.







WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLC("MAXIM" OR "FIRM") CONSENTED TO THE SANCTIONS AND TO THE ENTRYOF FINDINGS THAT IT FAILED TO ESTABLISH, DOCUMENT, AND MAINTAIN ASYSTEM OF RISK MANAGEMENT CONTROLS AND SUPERVISORYPROCEDURES, REASONABLY DESIGNED TO MANAGE THE FINANCIAL ANDREGULATORY RISK OF ITS BUSINESS ACTIVITY. THUS, IN VIOLATION OFTHE SECURITIES EXCHANGE ACT OF 1934 (RULE 15C3-5 OR MARKETACCESS RULE). MAXIM FAILED TO SATISFY RULE 15C3-5 CREDIT LIMITREQUIREMENTS BY FAILING TO APPLY CREDIT LIMITS TO ANY OF ITSINSTITUTIONAL CUSTOMERS AND FAILING TO MAINTAIN ANYDOCUMENTATION, INCLUDING WRITTEN SUPERVISORY PROCEDURES(WSPS), RELATED TO CREDIT LIMITS. THEREFORE, TO PREVENT THEENTRY OF ORDERS EXCEEDING APPROPRIATE PRE-SET CREDITTHRESHOLDS. THE FINDINGS STATED THAT MAXIM DID NOT EMPLOYCONTROLS AND PROCEDURES REASONABLY DESIGNED TO POTENTIALLYPREVENT ERRONEOUS ORDERS. MAXIM DID NOT UTILIZE A REASONABLEAVERAGE DAILY VOLUME (ADV) CONTROL LIMIT. THE ERRONEOUS ORDERCONTROLS MAXIM IMPLEMENTED WERE SOFT LIMITS, RATHER THANHARD BLOCKS. IN ADDITION, THE FIRM FAILED TO PROVIDE EVIDENCETHAT IT TRAINED OR SUPERVISED ITS TRADERS WITH RESPECT TO THEOVERRIDING OF SUCH LIMITS, AND FAILED TO MAINTAIN ANY RECORDSOF WHEN FIRM TRADERS BYPASSED SUCH SOFT BLOCKS. THE FINDINGSALSO STATED THAT MAXIM VIOLATED THE MARKET ACCESS RULE BY NOTHAVING A SPOOFING OR LAYERING REVIEW. FINRA FOUND THAT MAXIM'SWSPS FAILED TO DESCRIBE IN SUFFICIENT DETAIL HOW THE FIRMSHOULD CONDUCT ITS MANDATED ANNUAL REVIEW. MOREOVER, MAXIMFAILED TO PROVIDE EVIDENCE THAT IT REVIEWED THE EFFECTIVENESSOR THE REASONABLENESS OF ITS ERRONEOUS ORDER CONTROLS ORITS CREDIT LIMITS. A REASONABLE MARKET ACCESS RULE ANNUALREVIEW SHOULD HAVE IDENTIFIED THE DEFICIENCIES NOTED ABOVE,INCLUDING INSTITUTIONAL CUSTOMERS TRADING WITHOUT PRE-TRADECREDIT THRESHOLDS. FINRA ALSO FOUND THAT THE FIRM FAILED TOESTABLISH AND MAINTAIN WSPS AND A SUPERVISORY SYSTEMREASONABLY DESIGNED TO DETECT AND PREVENT POTENTIALLYMANIPULATIVE TRADING AND ACHIEVE COMPLIANCE WITH THESECURITIES EXCHANGE ACT OF 1934 (RULE 15C3-5 OR MARKET ACCESSRULE). MAXIM DID NOT HAVE WRITTEN PROCEDURES RELATED TOCREDIT LIMITS, AND FAILED TO APPLY CREDIT LIMITS TO ANY OF ITSCUSTOMERS. MAXIM FAILED TO DOCUMENT ITS PROCESS FOR SETTINGITS ERRONEOUS ORDER CONTROLS OR THE METHODOLOGY USED TODETERMINE FUNCTIONAL AND APPROPRIATE ERRONEOUS ORDERCONTROLS, AND FAILED TO DETAIL ITS PROCESS FOR EVALUATING ANDREVIEWING CONTROL LIMITS AND PROCEDURES. IN ADDITION, FINRADETERMINED THAT MAXIM'S WSPS DID NOT INCLUDE METHODS FORSUPERVISING CLIENT TRADING. WHILE THE FIRM DID HAVE CERTAINPOST-TRADE SURVEILLANCES IN PLACE, THE WSPS DID NOT IN ALLINSTANCES STATE HOW EACH REVIEW ASSOCIATED WITH TRADINGACTIVITY SHOULD BE CONDUCTED OR HOW ISSUES SHOULD BEESCALATED. THE WSPS ALSO FAILED TO DOCUMENT THE BASIS FORPARTICULAR CONTROL LIMITS, AND FAILED TO DETAIL THE FIRM'SPROCESS FOR EVALUATING AND REVIEWING CONTROL LIMITS ANDPROCEDURES. ADDITIONALLY, THE FIRM'S WSPS FAILED TO SPECIFY THECONTROLS AND PROCEDURES THE FIRM UNDERTOOK TO ENSURE POST-TRADE EXECUTION REPORTS WERE AVAILABLE IMMEDIATELY TOSURVEILLANCE PERSONNEL, AND FAILED TO DETAIL THE FIRM'S PROCESSFOR EVALUATING AND REVIEWING CONTROL LIMITS AND PROCEDURES.MOREOVER, AS PREVIOUSLY DISCUSSED, THE FIRM FAILED TO CONDUCTANY SUPERVISION FOR SPOOFING AND LAYERING. MAXIM'S WSPS DIDNOT SPECIFY THE MANNER IN WHICH ANNUAL REVIEW OF MARKETACCESS CONTROLS SHOULD BE CONDUCTED. THE FIRM DID NOT REVIEWWHETHER THE CONTROLS WERE APPROPRIATE OR EFFECTIVE GIVENTHE FIRM'S BUSINESS, AND THE FIRM DID NOT CONDUCT A REVIEWRELATED TO CREDIT LIMITS.








Other


N/A


Docket/Case Number: 2016-12-00089

Principal Product Type: Equity Listed (Common & Preferred Stock)


WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLC("MAXIM" OR "FIRM") CONSENTED TO THE SANCTIONS AND TO THE ENTRYOF FINDINGS THAT IT FAILED TO ESTABLISH, DOCUMENT, AND MAINTAIN ASYSTEM OF RISK MANAGEMENT CONTROLS AND SUPERVISORYPROCEDURES, REASONABLY DESIGNED TO MANAGE THE FINANCIAL ANDREGULATORY RISK OF ITS BUSINESS ACTIVITY. THUS, IN VIOLATION OFTHE SECURITIES EXCHANGE ACT OF 1934 (RULE 15C3-5 OR MARKETACCESS RULE). MAXIM FAILED TO SATISFY RULE 15C3-5 CREDIT LIMITREQUIREMENTS BY FAILING TO APPLY CREDIT LIMITS TO ANY OF ITSINSTITUTIONAL CUSTOMERS AND FAILING TO MAINTAIN ANYDOCUMENTATION, INCLUDING WRITTEN SUPERVISORY PROCEDURES(WSPS), RELATED TO CREDIT LIMITS. THEREFORE, TO PREVENT THEENTRY OF ORDERS EXCEEDING APPROPRIATE PRE-SET CREDITTHRESHOLDS. THE FINDINGS STATED THAT MAXIM DID NOT EMPLOYCONTROLS AND PROCEDURES REASONABLY DESIGNED TO POTENTIALLYPREVENT ERRONEOUS ORDERS. MAXIM DID NOT UTILIZE A REASONABLEAVERAGE DAILY VOLUME (ADV) CONTROL LIMIT. THE ERRONEOUS ORDERCONTROLS MAXIM IMPLEMENTED WERE SOFT LIMITS, RATHER THANHARD BLOCKS. IN ADDITION, THE FIRM FAILED TO PROVIDE EVIDENCETHAT IT TRAINED OR SUPERVISED ITS TRADERS WITH RESPECT TO THEOVERRIDING OF SUCH LIMITS, AND FAILED TO MAINTAIN ANY RECORDSOF WHEN FIRM TRADERS BYPASSED SUCH SOFT BLOCKS. THE FINDINGSALSO STATED THAT MAXIM VIOLATED THE MARKET ACCESS RULE BY NOTHAVING A SPOOFING OR LAYERING REVIEW. FINRA FOUND THAT MAXIM'SWSPS FAILED TO DESCRIBE IN SUFFICIENT DETAIL HOW THE FIRMSHOULD CONDUCT ITS MANDATED ANNUAL REVIEW. MOREOVER, MAXIMFAILED TO PROVIDE EVIDENCE THAT IT REVIEWED THE EFFECTIVENESSOR THE REASONABLENESS OF ITS ERRONEOUS ORDER CONTROLS ORITS CREDIT LIMITS. A REASONABLE MARKET ACCESS RULE ANNUALREVIEW SHOULD HAVE IDENTIFIED THE DEFICIENCIES NOTED ABOVE,INCLUDING INSTITUTIONAL CUSTOMERS TRADING WITHOUT PRE-TRADECREDIT THRESHOLDS. FINRA ALSO FOUND THAT THE FIRM FAILED TOESTABLISH AND MAINTAIN WSPS AND A SUPERVISORY SYSTEMREASONABLY DESIGNED TO DETECT AND PREVENT POTENTIALLYMANIPULATIVE TRADING AND ACHIEVE COMPLIANCE WITH THESECURITIES EXCHANGE ACT OF 1934 (RULE 15C3-5 OR MARKET ACCESSRULE). MAXIM DID NOT HAVE WRITTEN PROCEDURES RELATED TOCREDIT LIMITS, AND FAILED TO APPLY CREDIT LIMITS TO ANY OF ITSCUSTOMERS. MAXIM FAILED TO DOCUMENT ITS PROCESS FOR SETTINGITS ERRONEOUS ORDER CONTROLS OR THE METHODOLOGY USED TODETERMINE FUNCTIONAL AND APPROPRIATE ERRONEOUS ORDERCONTROLS, AND FAILED TO DETAIL ITS PROCESS FOR EVALUATING ANDREVIEWING CONTROL LIMITS AND PROCEDURES. IN ADDITION, FINRADETERMINED THAT MAXIM'S WSPS DID NOT INCLUDE METHODS FORSUPERVISING CLIENT TRADING. WHILE THE FIRM DID HAVE CERTAINPOST-TRADE SURVEILLANCES IN PLACE, THE WSPS DID NOT IN ALLINSTANCES STATE HOW EACH REVIEW ASSOCIATED WITH TRADINGACTIVITY SHOULD BE CONDUCTED OR HOW ISSUES SHOULD BEESCALATED. THE WSPS ALSO FAILED TO DOCUMENT THE BASIS FORPARTICULAR CONTROL LIMITS, AND FAILED TO DETAIL THE FIRM'SPROCESS FOR EVALUATING AND REVIEWING CONTROL LIMITS ANDPROCEDURES. ADDITIONALLY, THE FIRM'S WSPS FAILED TO SPECIFY THECONTROLS AND PROCEDURES THE FIRM UNDERTOOK TO ENSURE POST-TRADE EXECUTION REPORTS WERE AVAILABLE IMMEDIATELY TOSURVEILLANCE PERSONNEL, AND FAILED TO DETAIL THE FIRM'S PROCESSFOR EVALUATING AND REVIEWING CONTROL LIMITS AND PROCEDURES.MOREOVER, AS PREVIOUSLY DISCUSSED, THE FIRM FAILED TO CONDUCTANY SUPERVISION FOR SPOOFING AND LAYERING. MAXIM'S WSPS DIDNOT SPECIFY THE MANNER IN WHICH ANNUAL REVIEW OF MARKETACCESS CONTROLS SHOULD BE CONDUCTED. THE FIRM DID NOT REVIEWWHETHER THE CONTROLS WERE APPROPRIATE OR EFFECTIVE GIVENTHE FIRM'S BUSINESS, AND THE FIRM DID NOT CONDUCT A REVIEWRELATED TO CREDIT LIMITS.


Resolution:

Other Sanctions Ordered: UNDERTAKING

Sanction Details: THE FIRM WAS CENSURED AND FINED $450,000.THE FIRM IS REQUIRED TO REVISE ITS WSPS AND SUPERVISORY SYSTEMTO ADDRESS THE DEFICIENCIES DESCRIBED IN THE OFFER OFSETTLEMENT AND CONSENT, INCLUDING HIRING A TRADING COMPLIANCESPECIALIST AND/OR INDEPENDENT CONSULTANT.

Regulator Statement IN ADDITION TO OTHER PERSONNEL CHANGES, THE FIRM HASUNDERTAKEN TO HIRE A TRADING COMPLIANCE SPECIALIST AND/ORINDEPENDENT CONSULTANT TO ADDRESS ITS COMPLIANCE WITHMARKET ACCESS RULE REQUIREMENTS.


No

Sanctions Ordered: CensureMonetary/Fine $450,000.00

Decision & Order of Offer of Settlement






Regulator Statement IN ADDITION TO OTHER PERSONNEL CHANGES, THE FIRM HASUNDERTAKEN TO HIRE A TRADING COMPLIANCE SPECIALIST AND/ORINDEPENDENT CONSULTANT TO ADDRESS ITS COMPLIANCE WITHMARKET ACCESS RULE REQUIREMENTS.




Other


Docket/Case Number: 2016-12-00089



Allegations: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLC("MAXIM" OR "FIRM") ENTERED INTO AN OFFER OF SETTLEMENT ANDCONSENT WITHOUT ADJUDICATION OF ANY ISSUES OF LAW OR FACT ANDWITHOUT ADMITTING OR DENYING ANY ALLEGATIONS OR FINDINGS,CONSENTING TO NYSE ARCA FINDINGS THAT THE FIRM VIOLATED (I) SECRULE 15C3-5 BY FAILING TO ESTABLISH, DOCUMENT, AND MAINTAIN ASYSTEM OF RISK MANAGEMENT CONTROLS AND SUPERVISORYPROCEDURES REASONABLY DESIGNED TO MANAGE THE FINANCIAL ANDREGULATORY RISK OF ITS BUSINESS ACTIVITY AND (II) NYSE ARCAEQUITIES RULE 6.18 AND NYSE ARCA RULE 11.18, BY FAILING TOESTABLISH AND MAINTAIN WRITTEN SUPERVISORY PROCEDURES ANDSUPERVISORY SYSTEMS REASONABLY DESIGNED TO DETECT ANDPREVENT POTENTIALLY MANIPULATIVE TRADING AND ACHIEVECOMPLIANCE WITH SEC RULE 15C3-5.

SPECIFIC TO THIS DECISION, NYSE ARCA FOUND THAT MAXIM FAILED TOMAINTAIN A SYSTEM OF APPLYING CREDIT LIMITS TO ITS INSTITUTIONALCUSTOMERS REASONABLY DESIGNED TO MANAGE THE FINANCIAL ANDREGULATORY RISK OF ITS BUSINESS ACTIVITY, FAILED TO EMPLOYCONTROLS AND PROCEDURES REASONABLY DESIGNED TO POTENTIALLYPREVENT CLEARLY ERRONEOUS ORDERS INCLUDING UTILIZING AREASONABLE AVERAGE DAILY VOLUME CONTROL AND LACKING ASPOOFING OR LAYERING REVIEW, AND FAILED TO CONDUCT A YEARLYMARKET ACCESS REVIEW THAT COULD POTENTIALLY HAVE HIGHLIGHTEDTHESE DEFICIENCIES. ADDITIONALLY AND IN REFERENCE TO THESEISSUES, NYSE ARCA FOUND THAT THE FIRM FAILED TO ESTABLISH ANDMAINTAIN WSPS AND A SUPERVISORY SYSTEM REASONABLY DESIGNEDTO MANAGE THE FINANCIAL AND REGULATORY RISK ASSOCIATED WITHMARKET ACCESS.








Other


N/A


Resolution:


Sanction Details: THE FIRM WAS CENSURED AND FINED $450,000. THE FIRM IS REQUIREDTO REVISE ITS WSPS AND SUPERVISORY SYSTEM TO ADDRESS THEDEFICIENCIES DESCRIBED IN THE OFFER OF SETTLEMENT ANDCONSENT/INCLUDING HIRING A TRADING COMPLIANCE SPECIALISTAND/OR INDEPENDENT CONSULTANT.

Firm Statement IN ADDITION TO OTHER PERSONNEL CHANGES, THE FIRM HASUNDERTAKEN TO HIRE A TRADING COMPLIANCE SPECIALIST AND/ORINDEPENDENT CONSULTANT TO ADDRESS ITS COMPLIANCE WITHMARKET ACCESS RULE REQUIREMENTS.


Decision & Order of Offer of Settlement

Disclosure 3 of 27

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Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOESTABLISH AND MAINTAIN A SUPERVISORY SYSTEM, AND ESTABLISH,MAINTAIN AND ENFORCE WRITTEN SUPERVISORY PROCEDURES (WSPS),REASONABLY DESIGNED TO DETECT AND PREVENT UNSUITABLE SHORT-TERM TRADING IN UITS. THE FINDINGS STATED THAT THE FIRM HAD NOPROCEDURES TO ADDRESS THE SUITABILITY CONCERNS RAISED BYSHORT-TERM TRADING IN UITS. THE FIRM ALSO DID NOT HAVE ANYSURVEILLANCE OR EXCEPTION REPORTS DESIGNED TO DETECTUNSUITABLE SHORT-TERM TRADING OF UITS AND DID NOT PROVIDEBROKERS OR SUPERVISORS ANY TRAINING ON UITS. SEVERAL FIRMREPRESENTATIVES RECOMMENDED AND EFFECTED SHORT-TERMTRADES OF UITS IN THEIR CUSTOMERS' ACCOUNTS, WHICH HADAPPROXIMATELY TWO-YEAR MATURITY DATES AND CARRIED SALESCHARGES RANGING FROM 1.95 PERCENT TO 3.95 PERCENT.NEVERTHELESS, THESE REPRESENTATIVES REPEATEDLYRECOMMENDED THAT THEIR CUSTOMERS SELL THEIR UIT POSITIONSLESS THAN ONE YEAR AFTER PURCHASE. IN ADDITION, ON SEVERALOCCASIONS, THESE REPRESENTATIVES RECOMMENDED THAT THEIRCUSTOMERS USE THE PROCEEDS FROM THE SHORT-TERM SALE OF A UITTO PURCHASE ANOTHER UIT WITH IDENTICAL INVESTMENT OBJECTIVES.AS A RESULT OF THIS TRADING, CUSTOMERS PAID EXCESS SALESCHARGES IN THE AMOUNT OF APPROXIMATELY $167,780.49.







Initiated By: FINRA





Principal Product Type: Unit Investment Trust(s)


WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOESTABLISH AND MAINTAIN A SUPERVISORY SYSTEM, AND ESTABLISH,MAINTAIN AND ENFORCE WRITTEN SUPERVISORY PROCEDURES (WSPS),REASONABLY DESIGNED TO DETECT AND PREVENT UNSUITABLE SHORT-TERM TRADING IN UITS. THE FINDINGS STATED THAT THE FIRM HAD NOPROCEDURES TO ADDRESS THE SUITABILITY CONCERNS RAISED BYSHORT-TERM TRADING IN UITS. THE FIRM ALSO DID NOT HAVE ANYSURVEILLANCE OR EXCEPTION REPORTS DESIGNED TO DETECTUNSUITABLE SHORT-TERM TRADING OF UITS AND DID NOT PROVIDEBROKERS OR SUPERVISORS ANY TRAINING ON UITS. SEVERAL FIRMREPRESENTATIVES RECOMMENDED AND EFFECTED SHORT-TERMTRADES OF UITS IN THEIR CUSTOMERS' ACCOUNTS, WHICH HADAPPROXIMATELY TWO-YEAR MATURITY DATES AND CARRIED SALESCHARGES RANGING FROM 1.95 PERCENT TO 3.95 PERCENT.NEVERTHELESS, THESE REPRESENTATIVES REPEATEDLYRECOMMENDED THAT THEIR CUSTOMERS SELL THEIR UIT POSITIONSLESS THAN ONE YEAR AFTER PURCHASE. IN ADDITION, ON SEVERALOCCASIONS, THESE REPRESENTATIVES RECOMMENDED THAT THEIRCUSTOMERS USE THE PROCEEDS FROM THE SHORT-TERM SALE OF A UITTO PURCHASE ANOTHER UIT WITH IDENTICAL INVESTMENT OBJECTIVES.AS A RESULT OF THIS TRADING, CUSTOMERS PAID EXCESS SALESCHARGES IN THE AMOUNT OF APPROXIMATELY $167,780.49.


Resolution:

Other Sanctions Ordered: INTEREST; REQUIRED TO REVIEW AND REVISE, AS NECESSARY, ITSSYSTEMS, POLICIES AND PROCEDURES (WRITTEN AND OTHERWISE) ANDTRAINING WITH RESPECT TO THE SALE OF UITS

Sanction Details: THE FIRM WAS CENSURED, FINED $65,000, ORDERED TO PAY $167,780.49,PLUS INTEREST, IN RESTITUTION TO CUSTOMERS AND REQUIRED TOREVIEW AND REVISE, AS NECESSARY, ITS SYSTEMS, POLICIES ANDPROCEDURES (WRITTEN AND OTHERWISE) AND TRAINING WITH RESPECTTO THE SALE OF UITS. FINES PAID IN FULL ON OCTOBER 30, 2018.


No

Sanctions Ordered: CensureMonetary/Fine $65,000.00Disgorgement/Restitution

Acceptance, Waiver & Consent(AWC)






https://www.finra.org/rules-guidance/oversight-enforcement/finra-disciplinary-actions?search=2016047630702


Initiated By: FINRA





Principal Product Type: Unit Investment Trust(s)


Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THEENTRY OF FINDINGS THAT IT FAILED TO ESTABLISH AND MAINTAIN ASUPERVISORY SYSTEM, AND ESTABLISH,MAINTAIN AND ENFORCE WRITTEN SUPERVISORY PROCEDURES (WSPS),REASONABLY DESIGNED TO DETECTAND PREVENT UNSUITABLE SHORT-TERM TRADING IN UITS. THE FINDINGSSTATED THAT THE FIRM HAD NOPROCEDURES TO ADDRESS THE SUITABILITY CONCERNS RAISED BYSHORT-TERM TRADING IN UITS. THE FIRMALSO DID NOT HAVE ANY SURVEILLANCE OR EXCEPTION REPORTSDESIGNED TO DETECT UNSUITABLE SHORTTERMTRADING OF UITS AND DID NOT PROVIDE BROKERS OR SUPERVISORSANY TRAINING ON UITS. SEVERALFIRM REPRESENTATIVES RECOMMENDED AND EFFECTED SHORT-TERMTRADES OF UITS IN THEIR CUSTOMERS'ACCOUNTS, WHICH HAD APPROXIMATELY TWO-YEAR MATURITY DATESAND CARRIED SALES CHARGESRANGING FROM 1.95 PERCENT TO 3.95 PERCENT. NEVERTHELESS, THESEREPRESENTATIVES REPEATEDLYRECOMMENDED THAT THEIR CUSTOMERS SELL THEIR UIT POSITIONSLESS THAN ONE YEAR AFTER PURCHASE.IN ADDITION, ON SEVERAL OCCASIONS, THESE REPRESENTATIVESRECOMMENDED THAT THEIR CUSTOMERSUSE THE PROCEEDS FROM THE SHORT-TERM SALE OF A UIT TOPURCHASE ANOTHER UIT WITH IDENTICALINVESTMENT OBJECTIVES. AS A RESULT OF THIS TRADING, CUSTOMERSPAID EXCESS SALES CHARGES INTHE AMOUNT OF APPROXIMATELY $167,780.49


Resolution: Acceptance, Waiver & Consent(AWC)








Other Sanctions Ordered: INTEREST; REQUIRED TO REVIEW AND REVISE, AS NECESSARY, ITSSYSTEMS, POLICIES ANDPROCEDURES (WRITTEN AND OTHERWISE) AND TRAINING WITH RESPECTTO THE SALE OF UITS

Sanction Details: THE FIRM WAS CENSURED, FINED $65,000, ORDERED TO PAY $167,780.49,PLUS INTEREST, INRESTITUTION TO CUSTOMERS AND REQUIRED TO REVIEW AND REVISE,AS NECESSARY, ITS SYSTEMS,POLICIES AND PROCEDURES (WRITTEN AND OTHERWISE) AND TRAININGWITH RESPECT TO THE SALE OFUITS


Disclosure 4 of 27

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Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT AFTERTRADING FOR ITS OWN MARKET-MAKING ACCOUNT, THE FIRM FAILED TOEXECUTE CUSTOMER ORDERS IN OVER-THE-COUNTER (OTC) EQUITYSECURITIES AT A PRICE THAT WOULD HAVE SATISFIED EACH CUSTOMER'SORDER. THE FINDINGS STATED THAT AFTER TRADING FOR ITS OWNMARKET-MAKING ACCOUNT, THE FIRM FAILED TO EXECUTE CUSTOMERORDERS IN OTC EQUITY SECURITIES, AND AFTER TRADING FOR ITS OWNMARKET-MAKING ACCOUNT, THE FIRM FAILED TO IMMEDIATELY EXECUTECUSTOMER ORDERS IN OTC EQUITY SECURITIES UP TO THE SIZE ATWHICH IT TRADED FOR ITS OWN ACCOUNT. THE FINDINGS ALSO STATEDTHAT THE FIRM PUBLISHED A QUOTATION FOR AN OTC EQUITY SECURITYOR A NON-EXCHANGE-LISTED SECURITY, OR, DIRECTLY OR INDIRECTLY,SUBMITTED SUCH QUOTATION FOR PUBLICATION, IN A QUOTATIONMEDIUM, THAT IS, OTC LINK, AND DID NOT HAVE IN ITS RECORDS THEDOCUMENTATION AND INFORMATION REQUIRED BY SEA RULE 15(C)2-11(A)AND (B) (PARAGRAPHS (A) AND (B) INFORMATION), AND, BASED UPON AREVIEW OF THE PARAGRAPHS (A) AND (B) INFORMATION, DID NOT HAVE AREASONABLE BASIS UNDER THE CIRCUMSTANCES FOR BELIEVING THAT:(I) THE PARAGRAPH (A) INFORMATION WAS ACCURATE IN ALL MATERIALRESPECTS, AND (II) THE SOURCES OF THE PARAGRAPH (A) INFORMATIONWERE RELIABLE. THE QUOTATIONS DID NOT REPRESENT A CUSTOMER'SINDICATION OF UNSOLICITED INTEREST. THE FINDINGS ALSO INCLUDEDTHAT THE FIRM FAILED TO FILE FORM 211 WITH FINRA AT LEAST THREEBUSINESS DAYS BEFORE THE QUOTATIONS WERE PUBLISHED ORDISPLAYED IN A QUOTATION MEDIUM. THE FIRM SUBMITTED QUOTATIONSFOR PUBLICATION IN A QUOTATION MEDIUM, THAT IS, OTC LINK, BASED ONAN ORDER THAT WAS RECEIVED FROM ANOTHER BROKER-DEALER,WITHOUT CONTEMPORANEOUSLY RECORDING THE IDENTITY OF THEPERSON FROM WHOM INFORMATION REGARDING THE UNSOLICITEDCUSTOMER ORDER OR INDICATION OF INTEREST WAS RECEIVED. FINRAFOUND THAT THE FIRM FAILED TO PUBLISH IMMEDIATELY A BID OR OFFERTHAT REFLECTED THE FULL SIZE OF CUSTOMER LIMIT ORDERS FOR OTCEQUITY SECURITIES HELD BY THE FIRM THAT WERE AT A PRICE THATWOULD HAVE IMPROVED THE BID OR OFFER OF THE FIRM IN SUCHSECURITIES. FINRA ALSO FOUND THAT THE FIRM FAILED TOCONTEMPORANEOUSLY OR PARTIALLY EXECUTE A CUSTOMER LIMITORDER IN AN OTC EQUITY SECURITY AFTER IT TRADED THE SUBJECTSECURITY FOR ITS OWN MARKET-MAKING ACCOUNT AT A PRICE THATWOULD HAVE SATISFIED THE CUSTOMER'S LIMIT ORDER; TRADED FOR ITSOWN MARKET-MAKING ACCOUNT AT PRICES THAT WOULD HAVESATISFIED CUSTOMER LIMIT ORDERS IN OTC EQUITY SECURITIES ANDFAILED TO IMMEDIATELY THEREAFTER EXECUTE THE CUSTOMER LIMITORDERS UP TO THE SIZE AND AT THE SAME, OR BETTER, PRICE AT WHICHIT TRADED FOR ITS OWN ACCOUNT; AND TRADED FOR ITS OWN MARKET-MAKING ACCOUNT AND FAILED TO IMMEDIATELY THEREAFTER EXECUTECUSTOMER LIMIT ORDERS IN OTC EQUITY SECURITIES UP TO THE SIZE ATWHICH IT TRADED FOR ITS OWN ACCOUNT. IN ADDITION, FINRADETERMINED THAT THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDEFOR SUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH RESPECT TO SECURITIES LAWS AND REGULATIONS AND FINRARULES. THE FIRM'S EXCEPTION REPORTS DID NOT CAPTURE VIOLATIONSTHAT OCCURRED: (I) AFTER THE FIRM ROUTED AWAY, ON AN AGENCYBASIS, ORDERS THAT IT ACCEPTED AND HELD FOR A PERIOD OF TIME AND(II) IN BETWEEN A CANCEL REQUEST AND THE CONFIRMATION OF THEREPLACEMENT REQUEST.







Initiated By: FINRA





Principal Product Type: Equity - OTC


WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT AFTERTRADING FOR ITS OWN MARKET-MAKING ACCOUNT, THE FIRM FAILED TOEXECUTE CUSTOMER ORDERS IN OVER-THE-COUNTER (OTC) EQUITYSECURITIES AT A PRICE THAT WOULD HAVE SATISFIED EACH CUSTOMER'SORDER. THE FINDINGS STATED THAT AFTER TRADING FOR ITS OWNMARKET-MAKING ACCOUNT, THE FIRM FAILED TO EXECUTE CUSTOMERORDERS IN OTC EQUITY SECURITIES, AND AFTER TRADING FOR ITS OWNMARKET-MAKING ACCOUNT, THE FIRM FAILED TO IMMEDIATELY EXECUTECUSTOMER ORDERS IN OTC EQUITY SECURITIES UP TO THE SIZE ATWHICH IT TRADED FOR ITS OWN ACCOUNT. THE FINDINGS ALSO STATEDTHAT THE FIRM PUBLISHED A QUOTATION FOR AN OTC EQUITY SECURITYOR A NON-EXCHANGE-LISTED SECURITY, OR, DIRECTLY OR INDIRECTLY,SUBMITTED SUCH QUOTATION FOR PUBLICATION, IN A QUOTATIONMEDIUM, THAT IS, OTC LINK, AND DID NOT HAVE IN ITS RECORDS THEDOCUMENTATION AND INFORMATION REQUIRED BY SEA RULE 15(C)2-11(A)AND (B) (PARAGRAPHS (A) AND (B) INFORMATION), AND, BASED UPON AREVIEW OF THE PARAGRAPHS (A) AND (B) INFORMATION, DID NOT HAVE AREASONABLE BASIS UNDER THE CIRCUMSTANCES FOR BELIEVING THAT:(I) THE PARAGRAPH (A) INFORMATION WAS ACCURATE IN ALL MATERIALRESPECTS, AND (II) THE SOURCES OF THE PARAGRAPH (A) INFORMATIONWERE RELIABLE. THE QUOTATIONS DID NOT REPRESENT A CUSTOMER'SINDICATION OF UNSOLICITED INTEREST. THE FINDINGS ALSO INCLUDEDTHAT THE FIRM FAILED TO FILE FORM 211 WITH FINRA AT LEAST THREEBUSINESS DAYS BEFORE THE QUOTATIONS WERE PUBLISHED ORDISPLAYED IN A QUOTATION MEDIUM. THE FIRM SUBMITTED QUOTATIONSFOR PUBLICATION IN A QUOTATION MEDIUM, THAT IS, OTC LINK, BASED ONAN ORDER THAT WAS RECEIVED FROM ANOTHER BROKER-DEALER,WITHOUT CONTEMPORANEOUSLY RECORDING THE IDENTITY OF THEPERSON FROM WHOM INFORMATION REGARDING THE UNSOLICITEDCUSTOMER ORDER OR INDICATION OF INTEREST WAS RECEIVED. FINRAFOUND THAT THE FIRM FAILED TO PUBLISH IMMEDIATELY A BID OR OFFERTHAT REFLECTED THE FULL SIZE OF CUSTOMER LIMIT ORDERS FOR OTCEQUITY SECURITIES HELD BY THE FIRM THAT WERE AT A PRICE THATWOULD HAVE IMPROVED THE BID OR OFFER OF THE FIRM IN SUCHSECURITIES. FINRA ALSO FOUND THAT THE FIRM FAILED TOCONTEMPORANEOUSLY OR PARTIALLY EXECUTE A CUSTOMER LIMITORDER IN AN OTC EQUITY SECURITY AFTER IT TRADED THE SUBJECTSECURITY FOR ITS OWN MARKET-MAKING ACCOUNT AT A PRICE THATWOULD HAVE SATISFIED THE CUSTOMER'S LIMIT ORDER; TRADED FOR ITSOWN MARKET-MAKING ACCOUNT AT PRICES THAT WOULD HAVESATISFIED CUSTOMER LIMIT ORDERS IN OTC EQUITY SECURITIES ANDFAILED TO IMMEDIATELY THEREAFTER EXECUTE THE CUSTOMER LIMITORDERS UP TO THE SIZE AND AT THE SAME, OR BETTER, PRICE AT WHICHIT TRADED FOR ITS OWN ACCOUNT; AND TRADED FOR ITS OWN MARKET-MAKING ACCOUNT AND FAILED TO IMMEDIATELY THEREAFTER EXECUTECUSTOMER LIMIT ORDERS IN OTC EQUITY SECURITIES UP TO THE SIZE ATWHICH IT TRADED FOR ITS OWN ACCOUNT. IN ADDITION, FINRADETERMINED THAT THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDEFOR SUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH RESPECT TO SECURITIES LAWS AND REGULATIONS AND FINRARULES. THE FIRM'S EXCEPTION REPORTS DID NOT CAPTURE VIOLATIONSTHAT OCCURRED: (I) AFTER THE FIRM ROUTED AWAY, ON AN AGENCYBASIS, ORDERS THAT IT ACCEPTED AND HELD FOR A PERIOD OF TIME AND(II) IN BETWEEN A CANCEL REQUEST AND THE CONFIRMATION OF THEREPLACEMENT REQUEST.









Resolution:

Other Sanctions Ordered: INTEREST; UNDERTAKING: REVISE THE FIRM'S WRITTEN SUPERVISORYPROCEDURES

Sanction Details: THE FIRM WAS CENSURED, FINED $120,000, ORDERED TO PAY $21,561.89,PLUS INTEREST, IN RESTITUTION TO CUSTOMERS, AND UNDERTAKES TOREVISE ITS WRITTEN SUPERVISORY PROCEDURES. FINES PAID IN FULLON JULY 31, 2017.


No




Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT AFTERTRADING FOR ITS OWN MARKET-MAKING ACCOUNT, THE FIRM FAILED TOEXECUTE CUSTOMER ORDERS IN OVER-THE-COUNTER (OTC) EQUITYSECURITIES AT A PRICE THAT WOULD HAVE SATISFIED EACH CUSTOMER'SORDER. THE FINDINGS STATED THAT AFTER TRADING FOR ITS OWNMARKET-MAKING ACCOUNT, THE FIRM FAILED TO EXECUTE CUSTOMERORDERS IN OTC EQUITY SECURITIES, AND AFTER TRADING FOR ITS OWNMARKET-MAKING ACCOUNT, THE FIRM FAILED TO IMMEDIATELY EXECUTECUSTOMER ORDERS IN OTC EQUITY SECURITIES UP TO THE SIZE ATWHICH IT TRADED FOR ITS OWN ACCOUNT. THE FINDINGS ALSO STATEDTHAT THE FIRM PUBLISHED A QUOTATION FOR AN OTC EQUITY SECURITYOR A NON-EXCHANGE-LISTED SECURITY, OR, DIRECTLY OR INDIRECTLY,SUBMITTED SUCH QUOTATION FOR PUBLICATION, IN A QUOTATIONMEDIUM, THAT IS, OTC LINK, AND DID NOT HAVE IN ITS RECORDS THEDOCUMENTATION AND INFORMATION REQUIRED BY SEA RULE 15(C)2-11(A)AND (B) (PARAGRAPHS (A) AND (B) INFORMATION), AND, BASED UPON AREVIEW OF THE PARAGRAPHS (A) AND (B) INFORMATION, DID NOT HAVE AREASONABLE BASIS UNDER THE CIRCUMSTANCES FOR BELIEVING THAT:(I) THE PARAGRAPH (A) INFORMATION WAS ACCURATE IN ALL MATERIALRESPECTS, AND (II) THE SOURCES OF THE PARAGRAPH (A) INFORMATIONWERE RELIABLE. THE QUOTATIONS DID NOT REPRESENT A CUSTOMER'SINDICATION OF UNSOLICITED INTEREST. THE FINDINGS ALSO INCLUDEDTHAT THE FIRM FAILED TO FILE FORM 211 WITH FINRA AT LEAST THREEBUSINESS DAYS BEFORE THE QUOTATIONS WERE PUBLISHED ORDISPLAYED IN A QUOTATION MEDIUM. THE FIRM SUBMITTED QUOTATIONSFOR PUBLICATION IN A QUOTATION MEDIUM, THAT IS, OTC LINK, BASED ONAN ORDER THAT WAS RECEIVED FROM ANOTHER BROKER-DEALER,WITHOUT CONTEMPORANEOUSLY RECORDING THE IDENTITY OF THEPERSON FROM WHOM INFORMATION REGARDING THE UNSOLICITEDCUSTOMER ORDER OR INDICATION OF INTEREST WAS RECEIVED. FINRAFOUND THAT THE FIRM FAILED TO PUBLISH IMMEDIATELY A BID OR OFFERTHAT REFLECTED THE FULL SIZE OF CUSTOMER LIMIT ORDERS FOR OTCEQUITY SECURITIES HELD BY THE FIRM THAT WERE AT A PRICE THATWOULD HAVE IMPROVED THE BID OR OFFER OF THE FIRM IN SUCHSECURITIES. FINRA ALSO FOUND THAT THE FIRM FAILED TOCONTEMPORANEOUSLY OR PARTIALLY EXECUTE A CUSTOMER LIMITORDER IN AN OTC EQUITY SECURITY AFTER IT TRADED THE SUBJECTSECURITY FOR ITS OWN MARKET-MAKING ACCOUNT AT A PRICE THATWOULD HAVE SATISFIED THE CUSTOMER'S LIMIT ORDER; TRADED FOR ITSOWN MARKET-MAKING ACCOUNT AT PRICES THAT WOULD HAVESATISFIED CUSTOMER LIMIT ORDERS IN OTC EQUITY SECURITIES ANDFAILED TO IMMEDIATELY THEREAFTER EXECUTE THE CUSTOMER LIMITORDERS UP TO THE SIZE AND AT THE SAME, OR BETTER, PRICE AT WHICHIT TRADED FOR ITS OWN ACCOUNT; AND TRADED FOR ITS OWN MARKET-MAKING ACCOUNT AND FAILED TO IMMEDIATELY THEREAFTER EXECUTECUSTOMER LIMIT ORDERS IN OTC EQUITY SECURITIES UP TO THE SIZE ATWHICH IT TRADED FOR ITS OWN ACCOUNT. IN ADDITION, FINRADETERMINED THAT THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDEFOR SUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH RESPECT TO SECURITIES LAWS AND REGULATIONS AND FINRARULES. THE FIRM'S EXCEPTION REPORTS DID NOT CAPTURE VIOLATIONSTHAT OCCURRED: (I) AFTER THE FIRM ROUTED AWAY, ON AN AGENCYBASIS, ORDERS THAT IT ACCEPTED AND HELD FOR A PERIOD OF TIME AND(II) IN BETWEEN A CANCEL REQUEST AND THE CONFIRMATION OF THEREPLACEMENT REQUEST.







Initiated By: FINRA





WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT AFTERTRADING FOR ITS OWN MARKET-MAKING ACCOUNT, THE FIRM FAILED TOEXECUTE CUSTOMER ORDERS IN OVER-THE-COUNTER (OTC) EQUITYSECURITIES AT A PRICE THAT WOULD HAVE SATISFIED EACH CUSTOMER'SORDER. THE FINDINGS STATED THAT AFTER TRADING FOR ITS OWNMARKET-MAKING ACCOUNT, THE FIRM FAILED TO EXECUTE CUSTOMERORDERS IN OTC EQUITY SECURITIES, AND AFTER TRADING FOR ITS OWNMARKET-MAKING ACCOUNT, THE FIRM FAILED TO IMMEDIATELY EXECUTECUSTOMER ORDERS IN OTC EQUITY SECURITIES UP TO THE SIZE ATWHICH IT TRADED FOR ITS OWN ACCOUNT. THE FINDINGS ALSO STATEDTHAT THE FIRM PUBLISHED A QUOTATION FOR AN OTC EQUITY SECURITYOR A NON-EXCHANGE-LISTED SECURITY, OR, DIRECTLY OR INDIRECTLY,SUBMITTED SUCH QUOTATION FOR PUBLICATION, IN A QUOTATIONMEDIUM, THAT IS, OTC LINK, AND DID NOT HAVE IN ITS RECORDS THEDOCUMENTATION AND INFORMATION REQUIRED BY SEA RULE 15(C)2-11(A)AND (B) (PARAGRAPHS (A) AND (B) INFORMATION), AND, BASED UPON AREVIEW OF THE PARAGRAPHS (A) AND (B) INFORMATION, DID NOT HAVE AREASONABLE BASIS UNDER THE CIRCUMSTANCES FOR BELIEVING THAT:(I) THE PARAGRAPH (A) INFORMATION WAS ACCURATE IN ALL MATERIALRESPECTS, AND (II) THE SOURCES OF THE PARAGRAPH (A) INFORMATIONWERE RELIABLE. THE QUOTATIONS DID NOT REPRESENT A CUSTOMER'SINDICATION OF UNSOLICITED INTEREST. THE FINDINGS ALSO INCLUDEDTHAT THE FIRM FAILED TO FILE FORM 211 WITH FINRA AT LEAST THREEBUSINESS DAYS BEFORE THE QUOTATIONS WERE PUBLISHED ORDISPLAYED IN A QUOTATION MEDIUM. THE FIRM SUBMITTED QUOTATIONSFOR PUBLICATION IN A QUOTATION MEDIUM, THAT IS, OTC LINK, BASED ONAN ORDER THAT WAS RECEIVED FROM ANOTHER BROKER-DEALER,WITHOUT CONTEMPORANEOUSLY RECORDING THE IDENTITY OF THEPERSON FROM WHOM INFORMATION REGARDING THE UNSOLICITEDCUSTOMER ORDER OR INDICATION OF INTEREST WAS RECEIVED. FINRAFOUND THAT THE FIRM FAILED TO PUBLISH IMMEDIATELY A BID OR OFFERTHAT REFLECTED THE FULL SIZE OF CUSTOMER LIMIT ORDERS FOR OTCEQUITY SECURITIES HELD BY THE FIRM THAT WERE AT A PRICE THATWOULD HAVE IMPROVED THE BID OR OFFER OF THE FIRM IN SUCHSECURITIES. FINRA ALSO FOUND THAT THE FIRM FAILED TOCONTEMPORANEOUSLY OR PARTIALLY EXECUTE A CUSTOMER LIMITORDER IN AN OTC EQUITY SECURITY AFTER IT TRADED THE SUBJECTSECURITY FOR ITS OWN MARKET-MAKING ACCOUNT AT A PRICE THATWOULD HAVE SATISFIED THE CUSTOMER'S LIMIT ORDER; TRADED FOR ITSOWN MARKET-MAKING ACCOUNT AT PRICES THAT WOULD HAVESATISFIED CUSTOMER LIMIT ORDERS IN OTC EQUITY SECURITIES ANDFAILED TO IMMEDIATELY THEREAFTER EXECUTE THE CUSTOMER LIMITORDERS UP TO THE SIZE AND AT THE SAME, OR BETTER, PRICE AT WHICHIT TRADED FOR ITS OWN ACCOUNT; AND TRADED FOR ITS OWN MARKET-MAKING ACCOUNT AND FAILED TO IMMEDIATELY THEREAFTER EXECUTECUSTOMER LIMIT ORDERS IN OTC EQUITY SECURITIES UP TO THE SIZE ATWHICH IT TRADED FOR ITS OWN ACCOUNT. IN ADDITION, FINRADETERMINED THAT THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDEFOR SUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH RESPECT TO SECURITIES LAWS AND REGULATIONS AND FINRARULES. THE FIRM'S EXCEPTION REPORTS DID NOT CAPTURE VIOLATIONSTHAT OCCURRED: (I) AFTER THE FIRM ROUTED AWAY, ON AN AGENCYBASIS, ORDERS THAT IT ACCEPTED AND HELD FOR A PERIOD OF TIME AND(II) IN BETWEEN A CANCEL REQUEST AND THE CONFIRMATION OF THEREPLACEMENT REQUEST.











Resolution:

Other Sanctions Ordered: INTEREST; UNDERTAKING: REVISE THE FIRM'S WRITTEN SUPERVISORYPROCEDURES

Sanction Details: THE FIRM WAS CENSURED, FINED $120,000, ORDERED TO PAY $21,561.89,PLUS INTEREST, IN RESTITUTION TO CUSTOMERS, AND UNDERTAKES TOREVISE ITS WRITTEN SUPERVISORY PROCEDURES.



Disclosure 5 of 27

i


Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT THE FIRM, ADISTRIBUTION PARTICIPANT PARTICIPATING IN A DISTRIBUTION OFSECURITIES ON BEHALF OF A NUMBER OF ISSUERS, ENTERED ITS QUOTEINTO THE MARKETPLACE DURING THE RESTRICTED PERIOD ASSOCIATEDWITH EACH DISTRIBUTION. THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANISSUER, SOLICITED THREE SEPARATE CUSTOMER ORDERS TOPURCHASE, IN 26 TRANSACTIONS TOTALING 17,500 SHARES, A COVEREDSECURITY, (I.E. THE COMMON STOCK OF THE ISSUER) DURING THERESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. AS A RESULT,THE FIRM VIOLATED SEC RULE 101 OF REGULATION M. THE FIRM, WHILEACTING AS A MANAGER (OR IN A SIMILAR CAPACITY) IN A DISTRIBUTION OFSECURITIES, WHICH WAS SUBJECT TO A RESTRICTED PERIOD UNDER SECRULE 101 ON BEHALF OF AN ISSUER, FAILED TO SUBMIT A REGULATION MRESTRICTED PERIOD NOTIFICATION NO LATER THAN THE BUSINESS DAYPRIOR TO THE FIRST COMPLETE TRADING SESSION OF THE APPLICABLERESTRICTED PERIOD (JANUARY 31, 2014 THROUGH FEBRUARY 5, 2014).THE FIRM, WHILE ACTING AS A MANAGER (OR IN A SIMILAR CAPACITY) IN ADISTRIBUTION OF SECURITIES, WHICH WERE SUBJECT TO RESTRICTEDPERIODS UNDER SEC RULE 101, ON BEHALF OF TWO ISSUERS, FAILED TOTIMELY SUBMIT A REGULATION M TRADING NOTIFICATION (TRADINGNOTIFICATION) TO NASDAQ. AS A RESULT OF ITS CONDUCT, THE FIRMVIOLATED NASDAQ RULES 4619(E)(1)(A) AND 4619(E)(5). THE FIRM'SSUPERVISORY SYSTEM DID NOT PROVIDE FOR SUPERVISIONREASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITH RESPECT TOSECURITIES LAWS AND REGULATIONS AND THE RULES OF FINRAAPPLICABLE TO THE CONDUCT DESCRIBED ABOVE. THE FIRM'S WRITTENSUPERVISORY PROCEDURES RELATING TO THE CONDUCT DESCRIBEDABOVE DID NOT INCLUDE: (A) THE IDENTIFICATION OF THE INDIVIDUAL(S)RESPONSIBLE FOR SUPERVISION WITH RESPECT TO THESE RULES; (B) ASTATEMENT OF THE SUPERVISORY STEP(S) TO BE TAKEN BY THEIDENTIFIED PERSON(S); (C) A STATEMENT AS TO HOW OFTEN SUCHPERSON(S) SHOULD TAKE SUCH STEP(S); AND (D) A STATEMENT AS TOHOW THE COMPLETION OF THE STEP(S) INCLUDED IN THE WRITTENSUPERVISORY PROCEDURES SHOULD BE DOCUMENTED. AS A RESULT,THE FIRM VIOLATED NASDAQ RULES 2110, 2010A, AND 3010.







Initiated By: NASDAQ STOCK MARKET







WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT THE FIRM, ADISTRIBUTION PARTICIPANT PARTICIPATING IN A DISTRIBUTION OFSECURITIES ON BEHALF OF A NUMBER OF ISSUERS, ENTERED ITS QUOTEINTO THE MARKETPLACE DURING THE RESTRICTED PERIOD ASSOCIATEDWITH EACH DISTRIBUTION. THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANISSUER, SOLICITED THREE SEPARATE CUSTOMER ORDERS TOPURCHASE, IN 26 TRANSACTIONS TOTALING 17,500 SHARES, A COVEREDSECURITY, (I.E. THE COMMON STOCK OF THE ISSUER) DURING THERESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. AS A RESULT,THE FIRM VIOLATED SEC RULE 101 OF REGULATION M. THE FIRM, WHILEACTING AS A MANAGER (OR IN A SIMILAR CAPACITY) IN A DISTRIBUTION OFSECURITIES, WHICH WAS SUBJECT TO A RESTRICTED PERIOD UNDER SECRULE 101 ON BEHALF OF AN ISSUER, FAILED TO SUBMIT A REGULATION MRESTRICTED PERIOD NOTIFICATION NO LATER THAN THE BUSINESS DAYPRIOR TO THE FIRST COMPLETE TRADING SESSION OF THE APPLICABLERESTRICTED PERIOD (JANUARY 31, 2014 THROUGH FEBRUARY 5, 2014).THE FIRM, WHILE ACTING AS A MANAGER (OR IN A SIMILAR CAPACITY) IN ADISTRIBUTION OF SECURITIES, WHICH WERE SUBJECT TO RESTRICTEDPERIODS UNDER SEC RULE 101, ON BEHALF OF TWO ISSUERS, FAILED TOTIMELY SUBMIT A REGULATION M TRADING NOTIFICATION (TRADINGNOTIFICATION) TO NASDAQ. AS A RESULT OF ITS CONDUCT, THE FIRMVIOLATED NASDAQ RULES 4619(E)(1)(A) AND 4619(E)(5). THE FIRM'SSUPERVISORY SYSTEM DID NOT PROVIDE FOR SUPERVISIONREASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITH RESPECT TOSECURITIES LAWS AND REGULATIONS AND THE RULES OF FINRAAPPLICABLE TO THE CONDUCT DESCRIBED ABOVE. THE FIRM'S WRITTENSUPERVISORY PROCEDURES RELATING TO THE CONDUCT DESCRIBEDABOVE DID NOT INCLUDE: (A) THE IDENTIFICATION OF THE INDIVIDUAL(S)RESPONSIBLE FOR SUPERVISION WITH RESPECT TO THESE RULES; (B) ASTATEMENT OF THE SUPERVISORY STEP(S) TO BE TAKEN BY THEIDENTIFIED PERSON(S); (C) A STATEMENT AS TO HOW OFTEN SUCHPERSON(S) SHOULD TAKE SUCH STEP(S); AND (D) A STATEMENT AS TOHOW THE COMPLETION OF THE STEP(S) INCLUDED IN THE WRITTENSUPERVISORY PROCEDURES SHOULD BE DOCUMENTED. AS A RESULT,THE FIRM VIOLATED NASDAQ RULES 2110, 2010A, AND 3010.


Resolution:

Other Sanctions Ordered: UNDERTAKING: REQUIRED TO REVISE THE FIRM'S WRITTENSUPERVISORY PROCEDURES

Sanction Details: THE FIRM WAS CENSURED, FINED $22,500 AND UNDERTAKES TO REVISETHE FIRM'S WRITTEN SUPERVISORY PROCEDURES.


No








Sanction Details: THE FIRM WAS CENSURED, FINED $22,500 AND UNDERTAKES TO REVISETHE FIRM'S WRITTEN SUPERVISORY PROCEDURES.



Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT THE FIRM, ADISTRIBUTION PARTICIPANT PARTICIPATING IN A DISTRIBUTION OFSECURITIES ON BEHALF OF A NUMBER OF ISSUERS, ENTERED ITS QUOTEINTO THE MARKETPLACE DURING THE RESTRICTED PERIOD ASSOCIATEDWITH EACH DISTRIBUTION. THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANISSUER, SOLICITED THREE SEPARATE CUSTOMER ORDERS TOPURCHASE, IN 26 TRANSACTIONS TOTALING 17,500 SHARES, A COVEREDSECURITY, (I.E. THE COMMON STOCK OF THE ISSUER) DURING THERESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. AS A RESULT,THE FIRM VIOLATED SEC RULE 101 OF REGULATION M. THE FIRM, WHILEACTING AS A MANAGER (OR IN A SIMILAR CAPACITY) IN A DISTRIBUTION OFSECURITIES, WHICH WAS SUBJECT TO A RESTRICTED PERIOD UNDER SECRULE 101 ON BEHALF OF AN ISSUER, FAILED TO SUBMIT A REGULATION MRESTRICTED PERIOD NOTIFICATION NO LATER THAN THE BUSINESS DAYPRIOR TO THE FIRST COMPLETE TRADING SESSION OF THE APPLICABLERESTRICTED PERIOD (JANUARY 31, 2014 THROUGH FEBRUARY 5, 2014).THE FIRM, WHILE ACTING AS A MANAGER (OR IN A SIMILAR CAPACITY) IN ADISTRIBUTION OF SECURITIES, WHICH WERE SUBJECT TO RESTRICTEDPERIODS UNDER SEC RULE 101, ON BEHALF OF TWO ISSUERS, FAILED TOTIMELY SUBMIT A REGULATION M TRADING NOTIFICATION (TRADINGNOTIFICATION) TO NASDAQ. AS A RESULT OF ITS CONDUCT, THE FIRMVIOLATED NASDAQ RULES 4619(E)(1)(A) AND 4619(E)(5). THE FIRM'SSUPERVISORY SYSTEM DID NOT PROVIDE FOR SUPERVISIONREASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITH RESPECT TOSECURITIES LAWS AND REGULATIONS AND THE RULES OF FINRAAPPLICABLE TO THE CONDUCT DESCRIBED ABOVE. THE FIRM'S WRITTENSUPERVISORY PROCEDURES RELATING TO THE CONDUCT DESCRIBEDABOVE DID NOT INCLUDE: (A) THE IDENTIFICATION OF THE INDIVIDUAL(S)RESPONSIBLE FOR SUPERVISION WITH RESPECT TO THESE RULES; (B) ASTATEMENT OF THE SUPERVISORY STEP(S) TO BE TAKEN BY THEIDENTIFIED PERSON(S); (C) A STATEMENT AS TO HOW OFTEN SUCHPERSON(S) SHOULD TAKE SUCH STEP(S); AND (D) A STATEMENT AS TOHOW THE COMPLETION OF THE STEP(S) INCLUDED IN THE WRITTENSUPERVISORY PROCEDURES SHOULD BE DOCUMENTED. AS A RESULT,THE FIRM VIOLATED NASDAQ RULES 2110, 2010A, AND 3010.















Resolution:

Other Sanctions Ordered: UNDERTAKING; REQUIRED TO REVISE THE FIRM'S WRITTENSUPERVISORY PROCEDURES.

Sanction Details: THE FIRM WAS CENSURED, FINED $22,500.00 AND UNDERTAKES TOREVISE THE FIRM'S WRITTEN SUPERVISORY PROCEDURES.



Disclosure 6 of 27

i


Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IN A SERIESOF NINE TRANSACTIONS, THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANISSUER, PURCHASED 8,500 SHARES OF A COVERED SECURITY (I.E., THECOMMON STOCK OF THE ISSUER) ON A PRINCIPAL BASIS DURING THERESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. THEFINDINGS STATED THAT THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANUMBER OF ISSUERS, ENTERED ITS QUOTE INTO THE MARKETPLACEDURING THE RESTRICTED PERIOD ASSOCIATED WITH EACHDISTRIBUTION. THE FINDINGS ALSO STATED THAT THE FIRM, WHILEACTING AS A MANAGER (OR IN A SIMILAR CAPACITY) IN A DISTRIBUTION OFSECURITIES, WHICH WAS SUBJECT TO A RESTRICTED PERIOD UNDER SECRULE 101 ON BEHALF OF THE ISSUER, FAILED TO SUBMIT A REGULATIONM RESTRICTED PERIOD NOTIFICATION TO FINRA. THE FINDINGS ALSOINCLUDED THAT THE FIRM, WHILE ACTING AS A MANAGER (OR IN ASIMILAR CAPACITY) IN A DISTRIBUTION OF SECURITIES, WHICH WERESUBJECT TO RESTRICTED PERIODS UNDER SEC RULE 101 ON BEHALF OFA NUMBER OF ISSUERS, FAILED TO SUBMIT A REGULATION M TRADINGNOTIFICATION TO FINRA. FINRA FOUND THAT THE FIRM, A DISTRIBUTIONPARTICIPANT PARTICIPATING IN A DISTRIBUTION OF SECURITIES ONBEHALF OF AN ISSUER, SOLICITED THREE SEPARATE CUSTOMER ORDERSTO PURCHASE, IN 26 TRANSACTIONS TOTALING 17,500 SHARES, ACOVERED SECURITY (I.E., THE COMMON STOCK OF THE ISSUER) DURINGTHE RESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. FINRAALSO FOUND THAT THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDEFOR SUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH RESPECT TO SECURITIES LAWS AND REGULATIONS AND THE FINRARULES APPLICABLE TO THE CONDUCT DESCRIBED ABOVE. THE FIRM'SWRITTEN SUPERVISORY PROCEDURES RELATING TO THE CONDUCTDESCRIBED ABOVE DID NOT INCLUDE: THE IDENTIFICATION OF THEINDIVIDUAL(S) RESPONSIBLE FOR SUPERVISION WITH RESPECT TOTHESE RULES; A STATEMENT OF THE SUPERVISORY STEP(S) TO BE TAKENBY THE IDENTIFIED PERSON(S); A STATEMENT AS TO HOW OFTEN SUCHPERSON(S) SHOULD TAKE SUCH STEP(S); AND A STATEMENT AS TO HOWTHE COMPLETION OF THE STEP(S) INCLUDED IN THE WRITTENSUPERVISORY PROCEDURES SHOULD BE DOCUMENTED.







Initiated By: FINRA







WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IN A SERIESOF NINE TRANSACTIONS, THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANISSUER, PURCHASED 8,500 SHARES OF A COVERED SECURITY (I.E., THECOMMON STOCK OF THE ISSUER) ON A PRINCIPAL BASIS DURING THERESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. THEFINDINGS STATED THAT THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANUMBER OF ISSUERS, ENTERED ITS QUOTE INTO THE MARKETPLACEDURING THE RESTRICTED PERIOD ASSOCIATED WITH EACHDISTRIBUTION. THE FINDINGS ALSO STATED THAT THE FIRM, WHILEACTING AS A MANAGER (OR IN A SIMILAR CAPACITY) IN A DISTRIBUTION OFSECURITIES, WHICH WAS SUBJECT TO A RESTRICTED PERIOD UNDER SECRULE 101 ON BEHALF OF THE ISSUER, FAILED TO SUBMIT A REGULATIONM RESTRICTED PERIOD NOTIFICATION TO FINRA. THE FINDINGS ALSOINCLUDED THAT THE FIRM, WHILE ACTING AS A MANAGER (OR IN ASIMILAR CAPACITY) IN A DISTRIBUTION OF SECURITIES, WHICH WERESUBJECT TO RESTRICTED PERIODS UNDER SEC RULE 101 ON BEHALF OFA NUMBER OF ISSUERS, FAILED TO SUBMIT A REGULATION M TRADINGNOTIFICATION TO FINRA. FINRA FOUND THAT THE FIRM, A DISTRIBUTIONPARTICIPANT PARTICIPATING IN A DISTRIBUTION OF SECURITIES ONBEHALF OF AN ISSUER, SOLICITED THREE SEPARATE CUSTOMER ORDERSTO PURCHASE, IN 26 TRANSACTIONS TOTALING 17,500 SHARES, ACOVERED SECURITY (I.E., THE COMMON STOCK OF THE ISSUER) DURINGTHE RESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. FINRAALSO FOUND THAT THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDEFOR SUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH RESPECT TO SECURITIES LAWS AND REGULATIONS AND THE FINRARULES APPLICABLE TO THE CONDUCT DESCRIBED ABOVE. THE FIRM'SWRITTEN SUPERVISORY PROCEDURES RELATING TO THE CONDUCTDESCRIBED ABOVE DID NOT INCLUDE: THE IDENTIFICATION OF THEINDIVIDUAL(S) RESPONSIBLE FOR SUPERVISION WITH RESPECT TOTHESE RULES; A STATEMENT OF THE SUPERVISORY STEP(S) TO BE TAKENBY THE IDENTIFIED PERSON(S); A STATEMENT AS TO HOW OFTEN SUCHPERSON(S) SHOULD TAKE SUCH STEP(S); AND A STATEMENT AS TO HOWTHE COMPLETION OF THE STEP(S) INCLUDED IN THE WRITTENSUPERVISORY PROCEDURES SHOULD BE DOCUMENTED.


Resolution:


No









Other Sanctions Ordered: UNDERTAKING: REQUIRED TO REVISE THE FIRM'S WRITTENSUPERVISORY PROCEDURES

Sanction Details: THE FIRM WAS CENSURED, FINED $27,500 AND UNDERTAKES TO REVISETHE FIRM'S WRITTEN SUPERVISORY PROCEDURES. FINE PAID IN FULL ONFEBRUARY 1, 2017.



Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IN A SERIESOF NINE TRANSACTIONS, THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANISSUER, PURCHASED 8,500 SHARES OF A COVERED SECURITY (I.E., THECOMMON STOCK OF THE ISSUER) ON A PRINCIPAL BASIS DURING THERESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. THEFINDINGS STATED THAT THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANUMBER OF ISSUERS, ENTERED ITS QUOTE INTO THE MARKETPLACEDURING THE RESTRICTED PERIOD ASSOCIATED WITH EACHDISTRIBUTION. THE FINDINGS ALSO STATED THAT THE FIRM, WHILEACTING AS A MANAGER (OR IN A SIMILAR CAPACITY) IN A DISTRIBUTION OFSECURITIES, WHICH WAS SUBJECT TO A RESTRICTED PERIOD UNDER SECRULE 101 ON BEHALF OF THE ISSUER, FAILED TO SUBMIT A REGULATIONM RESTRICTED PERIOD NOTIFICATION TO FINRA. THE FINDINGS ALSOINCLUDED THAT THE FIRM, WHILE ACTING AS A MANAGER (OR IN ASIMILAR CAPACITY) IN A DISTRIBUTION OF SECURITIES, WHICH WERESUBJECT TO RESTRICTED PERIODS UNDER SEC RULE 101 ON BEHALF OFA NUMBER OF ISSUERS, FAILED TO SUBMIT A REGULATION M TRADINGNOTIFICATION TO FINRA. FINRA FOUND THAT THE FIRM, A DISTRIBUTIONPARTICIPANT PARTICIPATING IN A DISTRIBUTION OF SECURITIES ONBEHALF OF AN ISSUER, SOLICITED THREE SEPARATE CUSTOMER ORDERSTO PURCHASE, IN 26 TRANSACTIONS TOTALING 17,500 SHARES, ACOVERED SECURITY (I.E., THE COMMON STOCK OF THE ISSUER) DURINGTHE RESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. FINRAALSO FOUND THAT THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDEFOR SUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH RESPECT TO SECURITIES LAWS AND REGULATIONS AND THE FINRARULES APPLICABLE TO THE CONDUCT DESCRIBED ABOVE. THE FIRM'SWRITTEN SUPERVISORY PROCEDURES RELATING TO THE CONDUCTDESCRIBED ABOVE DID NOT INCLUDE: THE IDENTIFICATION OF THEINDIVIDUAL(S) RESPONSIBLE FOR SUPERVISION WITH RESPECT TOTHESE RULES; A STATEMENT OF THE SUPERVISORY STEP(S) TO BE TAKENBY THE IDENTIFIED PERSON(S); A STATEMENT AS TO HOW OFTEN SUCHPERSON(S) SHOULD TAKE SUCH STEP(S); AND A STATEMENT AS TO HOWTHE COMPLETION OF THE STEP(S) INCLUDED IN THE WRITTENSUPERVISORY PROCEDURES SHOULD BE DOCUMENTED.







Initiated By: FINRA







WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IN A SERIESOF NINE TRANSACTIONS, THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANISSUER, PURCHASED 8,500 SHARES OF A COVERED SECURITY (I.E., THECOMMON STOCK OF THE ISSUER) ON A PRINCIPAL BASIS DURING THERESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. THEFINDINGS STATED THAT THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANUMBER OF ISSUERS, ENTERED ITS QUOTE INTO THE MARKETPLACEDURING THE RESTRICTED PERIOD ASSOCIATED WITH EACHDISTRIBUTION. THE FINDINGS ALSO STATED THAT THE FIRM, WHILEACTING AS A MANAGER (OR IN A SIMILAR CAPACITY) IN A DISTRIBUTION OFSECURITIES, WHICH WAS SUBJECT TO A RESTRICTED PERIOD UNDER SECRULE 101 ON BEHALF OF THE ISSUER, FAILED TO SUBMIT A REGULATIONM RESTRICTED PERIOD NOTIFICATION TO FINRA. THE FINDINGS ALSOINCLUDED THAT THE FIRM, WHILE ACTING AS A MANAGER (OR IN ASIMILAR CAPACITY) IN A DISTRIBUTION OF SECURITIES, WHICH WERESUBJECT TO RESTRICTED PERIODS UNDER SEC RULE 101 ON BEHALF OFA NUMBER OF ISSUERS, FAILED TO SUBMIT A REGULATION M TRADINGNOTIFICATION TO FINRA. FINRA FOUND THAT THE FIRM, A DISTRIBUTIONPARTICIPANT PARTICIPATING IN A DISTRIBUTION OF SECURITIES ONBEHALF OF AN ISSUER, SOLICITED THREE SEPARATE CUSTOMER ORDERSTO PURCHASE, IN 26 TRANSACTIONS TOTALING 17,500 SHARES, ACOVERED SECURITY (I.E., THE COMMON STOCK OF THE ISSUER) DURINGTHE RESTRICTED PERIOD ASSOCIATED WITH THE DISTRIBUTION. FINRAALSO FOUND THAT THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDEFOR SUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH RESPECT TO SECURITIES LAWS AND REGULATIONS AND THE FINRARULES APPLICABLE TO THE CONDUCT DESCRIBED ABOVE. THE FIRM'SWRITTEN SUPERVISORY PROCEDURES RELATING TO THE CONDUCTDESCRIBED ABOVE DID NOT INCLUDE: THE IDENTIFICATION OF THEINDIVIDUAL(S) RESPONSIBLE FOR SUPERVISION WITH RESPECT TOTHESE RULES; A STATEMENT OF THE SUPERVISORY STEP(S) TO BE TAKENBY THE IDENTIFIED PERSON(S); A STATEMENT AS TO HOW OFTEN SUCHPERSON(S) SHOULD TAKE SUCH STEP(S); AND A STATEMENT AS TO HOWTHE COMPLETION OF THE STEP(S) INCLUDED IN THE WRITTENSUPERVISORY PROCEDURES SHOULD BE DOCUMENTED.


Resolution:

Other Sanctions Ordered: UNDERTAKING: REQUIRED TO REVISE THE FIRM'S WRITTENSUPERVISORY PROCEDURES.

Sanction Details: THE FIRM WAS CENSURED, FINED $27,500.00 AND UNDERTAKES TOREVISE THE FIRM'S WRITTEN SUPERVISORY PROCEDURES.



Disclosure 7 of 27

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Allegations: A FINRA HEARING OFFICER CONSIDERED AN OFFER OF SETTLEMENT ANDCONSENT ENTERED INTO BETWEEN FINRA ON BEHALF OF NYSEREGULATION, INC. AND THE FIRM.THE FIRM SUBMITTED AN OFFER OF SETTLEMENT AND CONSENT FORTHE SOLE PURPOSE OF SETTLING THIS DISCIPLINARY PROCEEDING,WITHOUT ADJUDICATION OF ANY ISSUES OF LAW OR FACT, AND WITHOUTADMITTING OR DENYING ANY ALLEGATIONS OR FINDINGS REFERRED TOIN THE OFFER OF SETTLEMENT.THE HEARING OFFICER ACCEPTS THE OFFER OF SETTLEMENT ANDCONSENT AND ISSUES THIS DECISION.THIS MATTER INVOLVES THE FIRM'S COMPLIANCE WITH SEC RULE 101 OFREGULATION M, AND THE FIRM'S SUPERVISION THEREOF, PURSUANT TONYSE ARCA EQUITIES RULE 6.18(B).

THE FINDINGS STATED THAT THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANISSUER, ENTERED ITS QUOTE INTO THE MARKETPLACE DURING THERESTRICTED PERIOD.

THE FINDINGS ALSO STATED THAT THE FIRM FAILED TO ESTABLISH ANDMAINTAIN A SUPERVISORY SYSTEM THAT WAS REASONABLY DESIGNEDTO ENSURE COMPLIANCE WITH THE REQUIREMENTS OF SEC RULE 101 OFREGULATION.















A FINRA HEARING OFFICER CONSIDERED AN OFFER OF SETTLEMENT ANDCONSENT ENTERED INTO BETWEEN FINRA ON BEHALF OF NYSEREGULATION, INC. AND THE FIRM.THE FIRM SUBMITTED AN OFFER OF SETTLEMENT AND CONSENT FORTHE SOLE PURPOSE OF SETTLING THIS DISCIPLINARY PROCEEDING,WITHOUT ADJUDICATION OF ANY ISSUES OF LAW OR FACT, AND WITHOUTADMITTING OR DENYING ANY ALLEGATIONS OR FINDINGS REFERRED TOIN THE OFFER OF SETTLEMENT.THE HEARING OFFICER ACCEPTS THE OFFER OF SETTLEMENT ANDCONSENT AND ISSUES THIS DECISION.THIS MATTER INVOLVES THE FIRM'S COMPLIANCE WITH SEC RULE 101 OFREGULATION M, AND THE FIRM'S SUPERVISION THEREOF, PURSUANT TONYSE ARCA EQUITIES RULE 6.18(B).

THE FINDINGS STATED THAT THE FIRM, A DISTRIBUTION PARTICIPANTPARTICIPATING IN A DISTRIBUTION OF SECURITIES ON BEHALF OF ANISSUER, ENTERED ITS QUOTE INTO THE MARKETPLACE DURING THERESTRICTED PERIOD.

THE FINDINGS ALSO STATED THAT THE FIRM FAILED TO ESTABLISH ANDMAINTAIN A SUPERVISORY SYSTEM THAT WAS REASONABLY DESIGNEDTO ENSURE COMPLIANCE WITH THE REQUIREMENTS OF SEC RULE 101 OFREGULATION.


Resolution:

Other Sanctions Ordered: AN UNDERTAKING

Sanction Details: THE FIRM WAS CENSURED AND FINED $10,000. WITH AN UNDERTAKING:THE FIRM IS ORDERED TO REVISE THE FIRM'S WRITTEN SUPERVISORYPROCEDURES WITH RESPECT TO ESTABLISHING AND MAINTAINING ASUPERVISORY SYSTEM THAT WAS REASONABLY DESIGNED TO ENSURECOMPLIANCE WITH THE REQUIREMENTS OF SEC RULE 101 OFREGULATION.


No







www.finra.org/brokercheck User GuidanceTHE FIRM WAS CENSURED AND FINED $10,000. WITH AN UNDERTAKING:THE FIRM IS ORDERED TO REVISE THE FIRM'S WRITTEN SUPERVISORYPROCEDURES WITH RESPECT TO ESTABLISHING AND MAINTAINING ASUPERVISORY SYSTEM THAT WAS REASONABLY DESIGNED TO ENSURECOMPLIANCE WITH THE REQUIREMENTS OF SEC RULE 101 OFREGULATION.

Regulator Statement THE FIRM VIOLATED SEC RULE 101 OF REGULATION M, BY SOLICITINGCUSTOMERS TO PURCHASE SHARES OF A COVERED SECURITY DURING ARESTRICTED PERIOD AND ENTERING ITS QUOTE INTO THE MARKETPLACEDURING A RESTRICTED PERIOD, AND NYSE ARCA EQUITIES RULE 6.18(B),BY FAILING TO ESTABLISH AND MAINTAIN A SUPERVISORY SYSTEM THATWAS REASONABLY DESIGNED TO ENSURE COMPLIANCE WITH THEREQUIREMENTS OF SEC RULE 101 OF REGULATION M DURING THEREVIEW PERIOD.

THIS CASE INCLUDES CONDUCT THAT WAS ORIGINALLY IDENTIFIED INMATTER NO. 20140402922.








Allegations: A FINRA HEARING OFFICER CONSIDERED AN OFFER OF SETTLEMENT ANDCONSENT ENTERED INTO BETWEEN FINRA ON BEHALF OF NYSEREGULATION, INC. AND THE FIRM. THE FIRM SUBMITTED AN OFFER OFSETTLEMENT AND CONSENT FOR THE SOLE PURPOSE OF SETTLING THISDISCIPLINARY PROCEEDING, WITHOUT ADJUDICATION OF ANY ISSUES OFLAW OR FACT, AND WITHOUT ADMITTING OR DENYING ANY ALLEGATIONSOR FINDINGS REFERRED TO IN THE OFFER OF SETTLEMENT. THEHEARING OFFICER ACCEPTS THE OFFER OF SETTLEMENT AND CONSENTAND ISSUES THIS DECISION. THIS MATTER INVOLVES THE FIRM'SCOMPLIANCE WITH SEC RULE 101 OF REGULATION M, AND THE FIRM'SSUPERVISION THEREOF, PURSUANT TO NYSE ARCA EQUITIES RULE 6.18(B). THE FINDINGS STATED THAT THE FIRM, A DISTRIBUTIONPARTICIPANT PARTICIPATING IN A DISTRIBUTION OF SECURITIES ONBEHALF OF AN ISSUER, ENTERED ITS QUOTE INTO THE MARKETPLACEDURING THE RESTRICTED PERIOD. THE FINDINGS ALSO STATED THAT THEFIRM FAILED TO ESTABLISH AND MAINTAIN A SUPERVISORY SYSTEM THATWAS REASONABLY DESIGNED TO ENSURE COMPLIANCE WITH THEREQUIREMENTS OF SEC RULE 101 OF REGULATION.










Resolution:

Other Sanctions Ordered: AN UNDERTAKING

Sanction Details: THE FIRM WAS CENSURED AND FINED $10,000.00 WITH AN UNDERTAKING:THE FIRM IS ORDERED TO REVISE THE FIRM'S WRITTEN SUPERVISORYPROCEDURES WITH RESPECT TO ESTABLISHING AND MAINTAINING ASUPERVISORY SYSTEM THAT WAS REASONABLY DESIGNED TO ENSURECOMPLIANCE WITH THE REQUIREMENTS OF SEC RULE 101 OFREGULATION.



Disclosure 8 of 27

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Principal Product Type: Other

Other Product Type(s): NASDAQ LISTED SECURITIES

Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TODISPLAY IMMEDIATELY 83 CUSTOMER LIMIT ORDERS IN NASDAQ LISTEDSECURITIES IN ITS PUBLIC QUOTATION, WHEN EACH SUCH ORDER WAS ATA PRICE THAT WOULD HAVE IMPROVED THE FIRM'S BID OR OFFER INEACH SUCH SECURITY; OR WHEN THE ORDER WAS PRICED EQUAL TOTHE FIRM'S BID OR OFFER AND THE NATIONAL BEST BID OR OFFER FOREACH SUCH SECURITY, AND THE SIZE OF THE ORDER REPRESENTEDMORE THAN A DE MINIMIS CHANGE IN RELATION TO THE SIZE ASSOCIATEDWITH THE FIRM'S BID OR OFFER IN EACH SUCH SECURITY.









Resolution:


Sanction Details: THE FIRM WAS CENSURED AND FINED $12,500.


No










Other Product Type(s): NASDAQ LISTED SECURITIES

Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TODISPLAY IMMEDIATELY 83 CUSTOMER LIMIT ORDERS IN NASDAQ LISTEDSECURITIES IN ITS PUBLIC QUOTATION, WHEN EACH SUCH ORDER WAS ATA PRICE THAT WOULD HAVE IMPROVED THE FIRM'S BID OR OFFER INEACH SUCH SECURITY; OR WHEN THE ORDER WAS PRICED EQUAL TOTHE FIRM'S BID OR OFFER AND THE NATIONAL BEST BID OR OFFER FOREACH SUCH SECURITY, AND THE SIZE OF THE ORDER REPRESENTEDMORE THAN A DE MINIMIS CHANGE IN RELATION TO THE SIZE ASSOCIATEDWITH THE FIRM'S BID OR OFFER IN EACH SUCH SECURITY.








Resolution:





Disclosure 9 of 27

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Reporting Source: Firm

Initiated By: PROCEEDINGS BY THE COMMISSIONER OF BANKING AND INSURANCE,STATE OF NEW JERSEY.


Other


FINE - $5,000.


Docket/Case Number: REFERENCE # 1016959

Principal Product Type: Insurance


Allegations: FIRM ENTERED INTO A CONSENT ORDER (E15-117) WITH THECOMMISSIONER OF BANKING AND INSURANCE, STATE OF NEW JERSEY(REFERENCE # 1016959) FOR HAVING FAILED TO NOTIFY THECOMMISSIONER WITHIN 30 DAYS OF DISCIPLINARY ACTIONS TAKENAGAINST THE FIRM BY FINRA AND A STATE REGULATOR. THE FIRM ALSORENEWED ITS APPLICATION AND ERRONEOUSLY ANSWERED NO TO THEQUESTION ABOUT HAVING BEEN NAMED IN A FINRA ACTION. THESE AREVIOLATIONS OF NJSA 17.22A40(A)(1)(2),(3),(8) AND (19). THE FIRM HASALWAYS MADE DISCLOSURES TO CRD AND IT WAS AN ERROR INASSUMING THAT THE DISCLOSURES MADE TO CRD WOULD COVER THEINSURANCE DISCLOSURE REQUIREMENTS FOR THE STATE OF NJ.



Resolution:



Consent







Sanction Details: FINE

Disclosure 10 of 27

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Initiated By: FINRA





Principal Product Type: Debt - Corporate


Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOREPORT 247 S1 TRANSACTIONS IN TRADE REPORTING AND COMPLIANCEENGINE (TRACE)-ELIGIBLE CORPORATE DEBT SECURITIES TO TRACEWITHIN 15 MINUTES OF THE TIME OF EXECUTION.



Resolution:



FINE PAID IN FULL ON AUGUST 11, 2015.


No










Initiated By: FINRA







Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOREPORT 247 S1 TRANSACTIONS IN TRADE REPORTING AND COMPLIANCEENGINE (TRACE)-ELIGIBLE CORPORATE DEBT SECURITIES TO TRACEWITHIN 15 MINUTES OF THE TIME OF EXECUTION.



Resolution:





Disclosure 11 of 27

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Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT ACCEPTEDAN UNDERWRITING FEE IN ADVANCE OF THE COMMENCEMENT OF THEPUBLIC SALE OF THE SECURITIES BEING OFFERED. THE FINDINGSSTATED THAT THE FIRM FAILED TO PROPERLY RECORD THEUNDERWRITING FEE AS A LIABILITY IN ITS GENERAL LEDGER, EVENTHOUGH THE FIRM WAS NOT ENTITLED TO THE FEE, THUS CAUSING THESUBMISSION OF INACCURATE FOCUS REPORTS, ANNUAL AUDIT REPORTSAND NET CAPITAL COMPUTATIONS.








Initiated By: FINRA


Other


N/A




Other Product Type(s): PUBLIC OFFERINGS

WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT ACCEPTEDAN UNDERWRITING FEE IN ADVANCE OF THE COMMENCEMENT OF THEPUBLIC SALE OF THE SECURITIES BEING OFFERED. THE FINDINGSSTATED THAT THE FIRM FAILED TO PROPERLY RECORD THEUNDERWRITING FEE AS A LIABILITY IN ITS GENERAL LEDGER, EVENTHOUGH THE FIRM WAS NOT ENTITLED TO THE FEE, THUS CAUSING THESUBMISSION OF INACCURATE FOCUS REPORTS, ANNUAL AUDIT REPORTSAND NET CAPITAL COMPUTATIONS.


Resolution:


Sanction Details: THE FIRM IS CENSURED AND FINED $17,500.

FINE PAID IN FULL ON FEBRUARY 20, 2015.


No




Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT ACCEPTEDAN UNDERWRITING FEE IN ADVANCE OF THE COMMENCEMENT OF THEPUBLIC SALE OF THE SECURITIES BEING OFFERED. THE FINDINGSSTATED THAT THE FIRM FAILED TO PROPERLY RECORD THEUNDERWRITING FEE AS A LIABILITY IN ITS GENERAL LEDGER, EVENTHOUGH THE FIRM WAS NOT ENTITLED TO THE FEE, THUS CAUSING THESUBMISSION OF INACCURATE FOCUS REPORTS, ANNUAL AUDIT REPORTSAND NET CAPITAL COMPUTATIONS. AT NO TIME DID THIS CAUSE THE FIRMTO FALL INTO NET CAPITAL NON COMPLIANCE.








Initiated By: FINRA


Other


N/A




Other Product Type(s): PUBLIC OFFERINGS

WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT ACCEPTEDAN UNDERWRITING FEE IN ADVANCE OF THE COMMENCEMENT OF THEPUBLIC SALE OF THE SECURITIES BEING OFFERED. THE FINDINGSSTATED THAT THE FIRM FAILED TO PROPERLY RECORD THEUNDERWRITING FEE AS A LIABILITY IN ITS GENERAL LEDGER, EVENTHOUGH THE FIRM WAS NOT ENTITLED TO THE FEE, THUS CAUSING THESUBMISSION OF INACCURATE FOCUS REPORTS, ANNUAL AUDIT REPORTSAND NET CAPITAL COMPUTATIONS. AT NO TIME DID THIS CAUSE THE FIRMTO FALL INTO NET CAPITAL NON COMPLIANCE.


Resolution:


Sanction Details: THE FIRM IS CENSURED AND FINED 17500.00



Disclosure 12 of 27

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Initiated By: FINRA






Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOPUBLISH IMMEDIATELY A BID OR OFFER THAT REFLECTED THE PRICE ANDTHE FULL SIZE OF CUSTOMER LIMIT ORDERS FOR OVER-THE-COUNTER(OTC) EQUITY SECURITIES HELD BY THE FIRM THAT WERE AT A PRICETHAT WOULD HAVE IMPROVED THE BID OR OFFER OF THE FIRM IN SUCHSECURITIES.












Resolution:



FINE PAID IN FULL ON FEBRUARY 9, 2015.


No




Initiated By: FINRA







Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOPUBLISH IMMEDIATELY A BID OR OFFER THAT REFLECTED THE PRICE ANDTHE FULL SIZE OF CUSTOMER LIMIT ORDERS FOR OVER-THE-COUNTER(OTC) EQUITY SECURITIES HELD BY THE FIRM THAT WERE AT A PRICETHAT WOULD HAVE IMPROVED THE BID OR OFFER OF THE FIRM IN SUCHSECURITIES.










Resolution:





Disclosure 13 of 27

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Initiated By: FINRA


Other


N/A




Other Product Type(s): EQUITY SECURITIES

Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTION AND TO THE ENTRY OF FINDINGS THAT IT EFFECTEDSHORT SALES IN EQUITY SECURITIES FOR ITS OWN ACCOUNT WITHOUTBORROWING THE SECURITY, OR ENTERING INTO A BONA FIDEARRANGEMENT TO BORROW THE SECURITY, OR HAVING REASONABLEGROUNDS TO BELIEVE THAT THE SECURITY COULD BE BORROWED SOTHAT IT COULD BE DELIVERED ON A DATE DELIVERY IS DUE, ANDDOCUMENTING COMPLIANCE WITH SEC RULE 203(B)(1) OF REGULATIONSHO.



Resolution:


No









Sanction Details: SEE ABOVE

FINE PAID IN FULL ON AUGUST 19, 2014.


No



Initiated By: FINRA


Other





Other Product Type(s): EQUITY SECURITIES

Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTION AND TO THE ENTRY OF FINDINGS THAT IN 14INSTANCES, IT EFFECTED SHORT SALES IN EQUITY SECURITIES FOR ITSOWN ACCOUNT WITHOUT BORROWING THE SECURITY, OR ENTERINGINTO A BONA FIDE ARRANGEMENT TO BORROW THE SECURITY, ORHAVING REASONABLE GROUNDS TO BELIEVE THAT THE SECURITY COULDBE BORROWED SO THAT IT COULD BE DELIVERED ON A DATE DELIVERY ISDUE.



Resolution:












Disclosure 14 of 27

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Initiated By: FINRA






Other Product Type(s): NON-EXCHANGE-LISTED SECURITIES

Allegations: SEC RULE 15C2-11, FINRA RULES 2010, 6440, 6440.1 - MAXIM GROUP, LLCPUBLISHED QUOTATIONS FOR OVER-THE-COUNTER (OTC) EQUITYSECURITIES OR NON-EXCHANGE-LISTED SECURITIES OR, DIRECTLY ORINDIRECTLY, SUBMITTED SUCH QUOTATION FOR PUBLICATION, IN AQUOTATION MEDIUM, THAT IS, THE PINK SHEETS, LLC, AND DID NOT HAVEIN ITS RECORDS THE DOCUMENTATION AND INFORMATION REQUIRED BYSEC RULE 15C2-11(A) AND (B) ("PARAGRAPHS (A) AND (B) INFORMATION")AND, BASED UPON A REVIEW OF THE PARAGRAPHS (A) AND (B)INFORMATION, DID NOT HAVE A REASONABLE BASIS UNDER THECIRCUMSTANCES FOR BELIEVING THAT: THE PARAGRAPH (A)INFORMATION WAS ACCURATE IN ALL MATERIAL RESPECTS, AND THESOURCES OF THE PARAGRAPH (A) INFORMATION WERE RELIABLE. THEQUOTATIONS DID NOT REPRESENT A CUSTOMER'S INDICATION OFUNSOLICITED INTEREST. FOR EACH QUOTATION, THE FIRM FAILED TO FILEA FORM 211 WITH FINRA AT LEAST THREE BUSINESS DAYS BEFORE THEQUOTATION WAS PUBLISHED OR DISPLAYED IN A QUOTATION MEDIUM.THE FIRM SUBMITTED QUOTATIONS FOR PUBLICATION IN A QUOTATIONMEDIUM, THAT IS THE PINK SHEETS, LLC, BASED ON AN ORDER RECEIVEDFROM ANOTHER BROKER-DEALER, WITHOUT CONTEMPORANEOUSLYRECORDING THE IDENTITY OF THE PERSON FROM WHOM INFORMATIONREGARDING THE UNSOLICITED CUSTOMER ORDER OR INDICATION OFINTEREST WAS RECEIVED.



Resolution: Acceptance, Waiver & Consent(AWC)








Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE,THE FIRM IS CENSURED AND FINED $7,500. FINE PAID IN FULL10/08/13.


No



Initiated By: FINRA



Allegations: SEC RULE 15C2-11, FINRA RULES 2010, 6440, 6440.1 - MAXIM GROUP, LLCPUBLISHED QUOTATIONS FOR OVER-THE-COUNTER (OTC) EQUITYSECURITIES OR NON-EXCHANGE-LISTED SECURITIES OR, DIRECTLY ORINDIRECTLY, SUBMITTED SUCH QUOTATION FOR PUBLICATION, IN AQUOTATION MEDIUM, THAT IS, THE PINK SHEETS, LLC, AND DID NOT HAVEIN ITS RECORDS THE DOCUMENTATION AND INFORMATION REQUIRED BYSEC RULE 15C2-11(A) AND (B) ("PARAGRAPHS (A) AND (B) INFORMATION")AND, BASED UPON A REVIEW OF THE PARAGRAPHS (A) AND (B)INFORMATION, DID NOT HAVE A REASONABLE BASIS UNDER THECIRCUMSTANCES FOR BELIEVING THAT: THE PARAGRAPH (A)INFORMATION WAS ACCURATE IN ALL MATERIAL RESPECTS, AND THESOURCES OF THE PARAGRAPH (A) INFORMATION WERE RELIABLE. THEQUOTATIONS DID NOT REPRESENT A CUSTOMER'S INDICATION OFUNSOLICITED INTEREST. FOR EACH QUOTATION, THE FIRM FAILED TO FILEA FORM 211 WITH FINRA AT LEAST THREE BUSINESS DAYS BEFORE THEQUOTATION WAS PUBLISHED OR DISPLAYED IN A QUOTATION MEDIUM.THE FIRM SUBMITTED QUOTATIONS FOR PUBLICATION IN A QUOTATIONMEDIUM, THAT IS THE PINK SHEETS, LLC, BASED ON AN ORDER RECEIVEDFROM ANOTHER BROKER-DEALER, WITHOUT CONTEMPORANEOUSLYRECORDING THE IDENTITY OF THE PERSON FROM WHOM INFORMATIONREGARDING THE UNSOLICITED CUSTOMER ORDER OR INDICATION OFINTEREST WAS RECEIVED.











Other Product Type(s): NON-EXCHANGE-LISTED SECURITIES


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED AND FINED $7,500.



Disclosure 15 of 27

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Allegations: SEC RULES 10B-10, 17A-3, 611(A), 611(C), SEC RULE 605 OF REGULATIONNMS, FINRA RULES 2010, 6182, 6380A, 6380A(A), 6380A(A)(5)(G), 6624,7230A, 7230A(D)(4), 7330, NASD RULES 2110, 2111(A), 2320, 2440, 3010, 3110,6230(B)(1), 6230(C)(6)INTERPRETATIVE MATERIAL 2440 - MAXIM GROUP LLCFAILED TO EXECUTE ORDERS FULLY AND PROMPTLY. IN TRANSACTIONSFOR OR WITH CUSTOMERS, THE FIRM FAILED TO USE REASONABLEDILIGENCE TO ASCERTAIN THE BEST INTER-DEALER MARKET AND BUY ORSELL IN SUCH MARKET SO THAT THE RESULTANT PRICE TO ITSCUSTOMERS WAS AS FAVORABLE AS POSSIBLE UNDER PREVAILINGMARKET CONDITIONS. THE FIRM FAILED, WITHIN 90 SECONDS AFTEREXECUTION, TO TRANSMIT TO THE FINRA/NASDAQ TRADE REPORTINGFACILITY (FNTRF) LAST SALE REPORTS OF TRANSACTIONS INDESIGNATED SECURITIES, AND FAILED TO DESIGNATE THROUGH THEFNTRF SOME OF THE REPORTS AS LATE. THE FIRM FAILED TO REPORTTHE CORRECT EXECUTION TIME TO THE FNTRF IN SOME LAST SALEREPORTS OF TRANSACTIONS IN DESIGNATED SECURITIES. THISCONDUCT CONSTITUTES SEPARATE AND DISTINCT VIOLATIONS OF FINRARULES 6380A(A), 6380A(A)(5)(G) AND 7230A(D)(4) AND A PATTERN ORPRACTICE OF LATE REPORTING WITHOUT EXCEPTIONALCIRCUMSTANCES IN VIOLATION OF FINRA RULE 2010. THE FIRM FAILED TOREPORT TO THE TRADE REPORTING AND COMPLIANCE ENGINE (TRACE)THE CORRECT CONTRA-PARTY'S IDENTIFIER FOR TRANSACTIONS INTRACE-ELIGIBLE SECURITIES THAT IT WAS REQUIRED TO REPORT ANDFAILED TO REPORT TO TRACE TRANSACTIONS IN TRACE-ELIGIBLESECURITIES IT WAS REQUIRED TO REPORT. THE FIRM REPORTED LASTSALE REPORTS OF TRANSACTIONS IN DESIGNATED SECURITIES IT WASNOT REQUIRED TO REPORT; INCORRECTLY REPORTED PRINCIPALTRANSACTIONS AS "AGENT" TO THE FNTRF; REPORTED SOME PRINCIPALTRANSACTIONS AS "AGENT" TO THE FINRA/OTC TRADE REPORTINGFACILITY (OTCRF), AND INACCURATELY REPORTED A FEW RISKLESSPRINCIPAL TRANSACTIONS AS "PRINCIPAL" TO THE FNTRF. THE FIRMFAILED TO REPORT TO THE FNTRF THE CORRECT SYMBOL INDICATINGWHETHER TRANSACTIONS WERE A BUY, SELL OR CROSS IN SHORT SALETRANSACTIONS AND FAILED TO REPORT TO THE OTCRF THE CORRECTSYMBOL INDICATING WHETHER THE TRANSACTION WAS A BUY, SELL ORCROSS IN A FEW SHORT SALE TRANSACTIONS. THE FIRM FAILED TOSHOW THE TERMS AND CONDITIONS ON BROKERAGE ORDERMEMORANDUM; FAILED TO SHOW THE CORRECT EXECUTION TIME ONSOME BROKER ORDER MEMORANDUM; AND FAILED TO DOCUMENT TWOTRANSACTIONS ON ITS TRADING LEDGER. THE FIRM FAILED TO PROVIDEWRITTEN NOTIFICATION DISCLOSING TO ITS CUSTOMERS THATTRANSACTIONS WERE EXECUTED AT AN AVERAGE PRICE AND FAILED TOPROVIDE WRITTEN NOTIFICATION DISCLOSING TO ITS CUSTOMERS THECORRECT CAPACITY AND CORRECT COMPENSATION TYPE INTRANSACTIONS. THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDEFOR SUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH APPLICABLE SECURITIES LAWS, REGULATIONS AND FINRA RULESCONCERNING TRADE REPORTING, SHORT SALE REPORTING, TRADINGDURING A TRADING HALT, AND BOOKS AND RECORDS. THE FIRM SOLDCORPORATE BONDS TO CUSTOMERS AND FAILED TO SELL SUCH BONDSAT A PRICE THAT WAS FAIR, TAKING INTO CONSIDERATION ALL RELEVANTCIRCUMSTANCES, INCLUDING MARKET CONDITIONS WITH RESPECT TOEACH BOND AT THE TIME OF THE TRANSACTION, THE EXPENSE INVOLVEDAND THAT THE FIRM WAS ENTITLED TO A PROFIT. FOR A MONTH, THE FIRMMADE AVAILABLE A REPORT ON THE COVERED ORDERS IN NATIONALMARKET SYSTEM (NMS) SECURITIES IT RECEIVED FOR EXECUTION FROMANY PERSON WHICH INCLUDED INCORRECT INFORMATION REGARDINGTHE NUMBER OF CANCELLED SHARES, THE AVERAGE REALIZED SPREAD,THE AVERAGE EFFECTIVE SPREAD, PRICE-IMPROVED AVERAGE TIME, THENUMBER OF AT-THE-QUOTE SHARES, THE AT-THE-QUOTE AVERAGE TIME,THE NUMBER OF OUTSIDE-THE-QUOTE SHARES, THE OUTSIDE-THE-QUOTE AVERAGE AMOUNT, AND THE OUTSIDE-THE-QUOTE AVERAGETIME. [CONTINUED IN COMMENT]







Initiated By: FINRA

SEC RULES 10B-10, 17A-3, 611(A), 611(C), SEC RULE 605 OF REGULATIONNMS, FINRA RULES 2010, 6182, 6380A, 6380A(A), 6380A(A)(5)(G), 6624,7230A, 7230A(D)(4), 7330, NASD RULES 2110, 2111(A), 2320, 2440, 3010, 3110,6230(B)(1), 6230(C)(6)INTERPRETATIVE MATERIAL 2440 - MAXIM GROUP LLCFAILED TO EXECUTE ORDERS FULLY AND PROMPTLY. IN TRANSACTIONSFOR OR WITH CUSTOMERS, THE FIRM FAILED TO USE REASONABLEDILIGENCE TO ASCERTAIN THE BEST INTER-DEALER MARKET AND BUY ORSELL IN SUCH MARKET SO THAT THE RESULTANT PRICE TO ITSCUSTOMERS WAS AS FAVORABLE AS POSSIBLE UNDER PREVAILINGMARKET CONDITIONS. THE FIRM FAILED, WITHIN 90 SECONDS AFTEREXECUTION, TO TRANSMIT TO THE FINRA/NASDAQ TRADE REPORTINGFACILITY (FNTRF) LAST SALE REPORTS OF TRANSACTIONS INDESIGNATED SECURITIES, AND FAILED TO DESIGNATE THROUGH THEFNTRF SOME OF THE REPORTS AS LATE. THE FIRM FAILED TO REPORTTHE CORRECT EXECUTION TIME TO THE FNTRF IN SOME LAST SALEREPORTS OF TRANSACTIONS IN DESIGNATED SECURITIES. THISCONDUCT CONSTITUTES SEPARATE AND DISTINCT VIOLATIONS OF FINRARULES 6380A(A), 6380A(A)(5)(G) AND 7230A(D)(4) AND A PATTERN ORPRACTICE OF LATE REPORTING WITHOUT EXCEPTIONALCIRCUMSTANCES IN VIOLATION OF FINRA RULE 2010. THE FIRM FAILED TOREPORT TO THE TRADE REPORTING AND COMPLIANCE ENGINE (TRACE)THE CORRECT CONTRA-PARTY'S IDENTIFIER FOR TRANSACTIONS INTRACE-ELIGIBLE SECURITIES THAT IT WAS REQUIRED TO REPORT ANDFAILED TO REPORT TO TRACE TRANSACTIONS IN TRACE-ELIGIBLESECURITIES IT WAS REQUIRED TO REPORT. THE FIRM REPORTED LASTSALE REPORTS OF TRANSACTIONS IN DESIGNATED SECURITIES IT WASNOT REQUIRED TO REPORT; INCORRECTLY REPORTED PRINCIPALTRANSACTIONS AS "AGENT" TO THE FNTRF; REPORTED SOME PRINCIPALTRANSACTIONS AS "AGENT" TO THE FINRA/OTC TRADE REPORTINGFACILITY (OTCRF), AND INACCURATELY REPORTED A FEW RISKLESSPRINCIPAL TRANSACTIONS AS "PRINCIPAL" TO THE FNTRF. THE FIRMFAILED TO REPORT TO THE FNTRF THE CORRECT SYMBOL INDICATINGWHETHER TRANSACTIONS WERE A BUY, SELL OR CROSS IN SHORT SALETRANSACTIONS AND FAILED TO REPORT TO THE OTCRF THE CORRECTSYMBOL INDICATING WHETHER THE TRANSACTION WAS A BUY, SELL ORCROSS IN A FEW SHORT SALE TRANSACTIONS. THE FIRM FAILED TOSHOW THE TERMS AND CONDITIONS ON BROKERAGE ORDERMEMORANDUM; FAILED TO SHOW THE CORRECT EXECUTION TIME ONSOME BROKER ORDER MEMORANDUM; AND FAILED TO DOCUMENT TWOTRANSACTIONS ON ITS TRADING LEDGER. THE FIRM FAILED TO PROVIDEWRITTEN NOTIFICATION DISCLOSING TO ITS CUSTOMERS THATTRANSACTIONS WERE EXECUTED AT AN AVERAGE PRICE AND FAILED TOPROVIDE WRITTEN NOTIFICATION DISCLOSING TO ITS CUSTOMERS THECORRECT CAPACITY AND CORRECT COMPENSATION TYPE INTRANSACTIONS. THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDEFOR SUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH APPLICABLE SECURITIES LAWS, REGULATIONS AND FINRA RULESCONCERNING TRADE REPORTING, SHORT SALE REPORTING, TRADINGDURING A TRADING HALT, AND BOOKS AND RECORDS. THE FIRM SOLDCORPORATE BONDS TO CUSTOMERS AND FAILED TO SELL SUCH BONDSAT A PRICE THAT WAS FAIR, TAKING INTO CONSIDERATION ALL RELEVANTCIRCUMSTANCES, INCLUDING MARKET CONDITIONS WITH RESPECT TOEACH BOND AT THE TIME OF THE TRANSACTION, THE EXPENSE INVOLVEDAND THAT THE FIRM WAS ENTITLED TO A PROFIT. FOR A MONTH, THE FIRMMADE AVAILABLE A REPORT ON THE COVERED ORDERS IN NATIONALMARKET SYSTEM (NMS) SECURITIES IT RECEIVED FOR EXECUTION FROMANY PERSON WHICH INCLUDED INCORRECT INFORMATION REGARDINGTHE NUMBER OF CANCELLED SHARES, THE AVERAGE REALIZED SPREAD,THE AVERAGE EFFECTIVE SPREAD, PRICE-IMPROVED AVERAGE TIME, THENUMBER OF AT-THE-QUOTE SHARES, THE AT-THE-QUOTE AVERAGE TIME,THE NUMBER OF OUTSIDE-THE-QUOTE SHARES, THE OUTSIDE-THE-QUOTE AVERAGE AMOUNT, AND THE OUTSIDE-THE-QUOTE AVERAGETIME. [CONTINUED IN COMMENT]











Other Product Type(s): DESIGNATED SECURITIES, TRACE-ELIGIBLE SECURITIES, NATIONALMARKET SYSTEM SECURITIES


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED, FINED $95,000, REQUIRED TO PAY$10,123.33, PLUS INTEREST, IN RESTITUTION TO INVESTORS AND REVISEITS WSPS REGARDING TRADE REPORTING, SHORT SALE REPORTING,TRADING DURING A TRADING HALT, BOOKS AND RECORDS, PREVENTINGTRADE-THROUGHS OF PROTECTED QUOTATIONS IN NMS STOCKS THATDO NOT FALL WITHIN ANY APPLICABLE EXCEPTION, AND IF RELYING ON ANEXCEPTION, ARE REASONABLY DESIGNED TO ASSURE COMPLIANCE WITHTHE TERMS OF THE EXCEPTION, THE SPECIFIC STEPS REQUIRED TOCOMPLY WITH THE SELF-HELP EXEMPTION OF SEC RULE 611, SHORTSALE REPORTING, ORDER HANDLING AND OATS REPORTING WITHIN 30BUSINESS DAYS OF ACCEPTANCE OF THIS AWC BY THE NAC. THE FIRMSHALL SUBMIT SATISFACTORY PROOF OF PAYMENT OF THE RESTITUTIONOR OF REASONABLE AND DOCUMENTED EFFORTS UNDERTAKEN TOEFFECT RESTITUTION TO FINRA NO LATER THAN 120 DAYS AFTERACCEPTANCE OF THIS AWC. ANY UNDISTRIBUTED RESTITUTION ANDINTEREST SHALL BE FORWARDED TO THE APPROPRIATE ESCHEAT,UNCLAIMED PROPERTY OR ABANDONED PROPERTY FUND FOR THESTATE IN WHICH THE CUSTOMER LAST RESIDED. FINE PAID JUNE 27, 2013.


No









WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED, FINED $95,000, REQUIRED TO PAY$10,123.33, PLUS INTEREST, IN RESTITUTION TO INVESTORS AND REVISEITS WSPS REGARDING TRADE REPORTING, SHORT SALE REPORTING,TRADING DURING A TRADING HALT, BOOKS AND RECORDS, PREVENTINGTRADE-THROUGHS OF PROTECTED QUOTATIONS IN NMS STOCKS THATDO NOT FALL WITHIN ANY APPLICABLE EXCEPTION, AND IF RELYING ON ANEXCEPTION, ARE REASONABLY DESIGNED TO ASSURE COMPLIANCE WITHTHE TERMS OF THE EXCEPTION, THE SPECIFIC STEPS REQUIRED TOCOMPLY WITH THE SELF-HELP EXEMPTION OF SEC RULE 611, SHORTSALE REPORTING, ORDER HANDLING AND OATS REPORTING WITHIN 30BUSINESS DAYS OF ACCEPTANCE OF THIS AWC BY THE NAC. THE FIRMSHALL SUBMIT SATISFACTORY PROOF OF PAYMENT OF THE RESTITUTIONOR OF REASONABLE AND DOCUMENTED EFFORTS UNDERTAKEN TOEFFECT RESTITUTION TO FINRA NO LATER THAN 120 DAYS AFTERACCEPTANCE OF THIS AWC. ANY UNDISTRIBUTED RESTITUTION ANDINTEREST SHALL BE FORWARDED TO THE APPROPRIATE ESCHEAT,UNCLAIMED PROPERTY OR ABANDONED PROPERTY FUND FOR THESTATE IN WHICH THE CUSTOMER LAST RESIDED. FINE PAID JUNE 27, 2013.

Regulator Statement ALLEGATIONS CONTINUED: THE FIRM FAILED TO ESTABLISH, MAINTAINAND ENFORCE WRITTEN POLICIES AND PROCEDURES REASONABLYDESIGNED TO PREVENT TRADE-THROUGHS OF PROTECTED QUOTATIONSIN NMS STOCKS THAT DO NOT FALL WITHIN ANY APPLICABLE EXCEPTION,AND IF RELYING ON AN EXCEPTION, ARE REASONABLY DESIGNED TOASSURE COMPLIANCE WITH THE TERMS OF THE EXCEPTION. THE FIRM'SSUPERVISORY SYSTEM DID NOT PROVIDE FOR SUPERVISIONREASONABLY DESIGN TO ACHIEVE COMPLIANCE WITH SEC RULE 611(C)OF REGULATION NMS. THE FIRM'S SUPERVISORY SYSTEM DID NOTINCLUDE WRITTEN SUPERVISORY PROCEDURES (WSPS) PROVIDING FORTHE SPECIFIC STEPS REQUIRED TO COMPLY WITH THE SELF-HELPEXEMPTION OF SEC RULE 611. THE FIRM'S SUPERVISORY SYSTEM DIDNOT PROVIDE FOR SUPERVISION REASONABLY DESIGNED TO ACHIEVECOMPLIANCE WITH APPLICABLE SECURITIES LAWS, REGULATIONS ANDNASD RULES ADDRESSING QUALITY OF MARKET TOPICS. THE FIRM'SWSPS FAILED TO PROVIDE FOR MINIMUM REQUIREMENTS FOR ADEQUATEWSPS IN SHORT SALE REPORTING, ORDER HANDLING AND OATSREPORTING.


Allegations: SEC RULES 10B-10, 17A-3, 611(A), 611(C), SEC RULE 605 OF REGULATIONNMS, FINRA RULES 2010, 6182, 6380A, 6380A(A), 6380A(A)(5)(G), 6624,7230A, 7230A(D)(4), 7330, NASD RULES 2110, 2111(A), 2320, 2440, 3010, 3110,6230(B)(1), 6230(C)(6)INTERPRETATIVE MATERIAL 2440 IN THAT THE FIRMFAILED TO EXECUTE ORDERS FULLY AND PROMPTLY. IN CUSTOMERTRANSACTIONS, THE FIRM FAILED TO USE REASONABLE DILIGENCE TOASCERTAIN THE BEST INTER-DEALER MARKET AND BUY OR SELL IN SUCHMARKET SO THAT THE RESULTANT PRICE WAS AS FAVORABLE ASPOSSIBLE UNDER PREVAILING MARKET CONDITIONS. THE FIRM FAILED,WITHIN 90 SECONDS AFTER EXECUTION, TO TRANSMIT TO THE FNTRFLAST SALE REPORTS OF TRANSACTIONS IN DESIGNATED SECURITIES,AND TO DESIGNATE THROUGH THE FNTRF SOME OF THE REPORTS ASLATE. THE FIRM FAILED TO REPORT THE CORRECT EXECUTION TIME TOTHE FNTRF IN SOME LAST SALE REPORTS OF TRANSACTIONS INDESIGNATED SECURITIES, IN NON COMPLIANCE WITH FINRA RULES6380A(A), 6380A(A)(5)(G), 7230A(D)(4) AND 2010. THE FIRM FAILED TOREPORT TO TRACE THE CORRECT CONTRA-PARTY'S IDENTIFIER FORTRANSACTIONS WHEN IT WAS REQUIRED TO REPORT AND TO REPORT TOTRACE TRANSACTIONS IT WAS REQUIRED TO REPORT. THE FIRMREPORTED LAST SALE REPORTS OF TRANSACTIONS IN DESIGNATEDSECURITIES IT WAS NOT REQUIRED TO REPORT; INCORRECTLYREPORTED PRINCIPAL TRANSACTIONS AS "AGENT" TO THE FNTRF;REPORTED SOME PRINCIPAL TRANSACTIONS AS "AGENT" TO THEFINRA/OTC TRADE REPORTING FACILITY (OTCRF), AND INACCURATELYREPORTED A FEW RISKLESS PRINCIPAL TRANSACTIONS AS "PRINCIPAL"TO THE FNTRF. THE FIRM FAILED TO REPORT TO THE FNTRF THECORRECT SYMBOL INDICATING WHETHER TRANSACTIONS WERE A BUY,SELL OR CROSS IN SHORT SALE TRANSACTIONS AND TO REPORT TO THEOTCRF THE CORRECT SYMBOL INDICATING WHETHER THE TRANSACTIONWAS A BUY, SELL OR CROSS IN A FEW SHORT SALE TRANSACTIONS. THEFIRM FAILED TO SHOW THE TERMS AND CONDITIONS ON ORDERMEMORANDUM; TO SHOW THE CORRECT EXECUTION TIME ON SOMEORDER MEMORANDUM; AND TO DOCUMENT TWO TRANSACTIONS ON ITSTRADING LEDGER. THE FIRM FAILED TO PROVIDE WRITTEN NOTIFICATIONDISCLOSING TO ITS CUSTOMERS THAT TRANSACTIONS WERE EXECUTEDAT AN AVERAGE PRICE AND TO PROVIDE WRITTEN NOTIFICATIONDISCLOSING TO ITS CUSTOMERS THE CORRECT CAPACITY AND CORRECTCOMPENSATION TYPE IN TRANSACTIONS. THE FIRM FAILED TO SELLCORPORATE BONDS AT A PRICE THAT WAS FAIR, TAKING INTOCONSIDERATION ALL RELEVANT CIRCUMSTANCES. FOR A MONTH, THEFIRM MADE AVAILABLE A REPORT ON COVERED ORDERS IN NMSSECURITIES IT RECEIVED FOR EXECUTION WHICH INCLUDED INCORRECTINFORMATION REGARDING NUMBER OF CANCELLED SHARES, AVERAGEREALIZED SPREAD, AVERAGE EFFECTIVE SPREAD, PRICE-IMPROVEDAVERAGE TIME, NUMBER OF AT-THE-QUOTE SHARES, AT-THE-QUOTEAVERAGE TIME, NUMBER OF OUTSIDE-THE-QUOTE SHARES, OUTSIDE-THE-QUOTE AVERAGE AMOUNT, AND OUTSIDE-THE-QUOTE AVERAGETIME. THE FIRM FAILED TO ESTABLISH, MAINTAIN AND ENFORCE WSPS TODO THE FOLLOWING: ACHIEVE COMPLIANCE WITH APPLICABLE RULESCONCERNING TRADE REPORTING, SHORT SALE REPORTING, TRADINGDURING A TRADING HALT, AND BOOKS AND RECORDS; REASONABLYPREVENT TRADE-THROUGHS OF PROTECTED QUOTATIONS IN NMSSTOCKS THAT DO NOT FALL WITHIN ANY APPLICABLE EXCEPTION, AND IFRELYING ON AN EXCEPTION, ARE REASONABLY DESIGNED TO ASSURECOMPLIANCE WITH THE TERMS OF THE EXCEPTION; ACHIEVECOMPLIANCE WITH SEC RULE 611(C) OF REGULATION NMS; PROVIDE FORTHE SPECIFIC STEPS REQUIRED TO COMPLY WITH THE SELF-HELPEXEMPTION OF SEC RULE 611; ACHIEVE COMPLIANCE WITH APPLICABLERULES ADDRESSING QUALITY OF MARKET TOPICS; AND PROVIDE FORMINIMUM REQUIREMENTS FOR ADEQUATE WSPS IN SHORT SALEREPORTING, ORDER HANDLING AND OATS REPORTING.







Initiated By: FINRA



SEC RULES 10B-10, 17A-3, 611(A), 611(C), SEC RULE 605 OF REGULATIONNMS, FINRA RULES 2010, 6182, 6380A, 6380A(A), 6380A(A)(5)(G), 6624,7230A, 7230A(D)(4), 7330, NASD RULES 2110, 2111(A), 2320, 2440, 3010, 3110,6230(B)(1), 6230(C)(6)INTERPRETATIVE MATERIAL 2440 IN THAT THE FIRMFAILED TO EXECUTE ORDERS FULLY AND PROMPTLY. IN CUSTOMERTRANSACTIONS, THE FIRM FAILED TO USE REASONABLE DILIGENCE TOASCERTAIN THE BEST INTER-DEALER MARKET AND BUY OR SELL IN SUCHMARKET SO THAT THE RESULTANT PRICE WAS AS FAVORABLE ASPOSSIBLE UNDER PREVAILING MARKET CONDITIONS. THE FIRM FAILED,WITHIN 90 SECONDS AFTER EXECUTION, TO TRANSMIT TO THE FNTRFLAST SALE REPORTS OF TRANSACTIONS IN DESIGNATED SECURITIES,AND TO DESIGNATE THROUGH THE FNTRF SOME OF THE REPORTS ASLATE. THE FIRM FAILED TO REPORT THE CORRECT EXECUTION TIME TOTHE FNTRF IN SOME LAST SALE REPORTS OF TRANSACTIONS INDESIGNATED SECURITIES, IN NON COMPLIANCE WITH FINRA RULES6380A(A), 6380A(A)(5)(G), 7230A(D)(4) AND 2010. THE FIRM FAILED TOREPORT TO TRACE THE CORRECT CONTRA-PARTY'S IDENTIFIER FORTRANSACTIONS WHEN IT WAS REQUIRED TO REPORT AND TO REPORT TOTRACE TRANSACTIONS IT WAS REQUIRED TO REPORT. THE FIRMREPORTED LAST SALE REPORTS OF TRANSACTIONS IN DESIGNATEDSECURITIES IT WAS NOT REQUIRED TO REPORT; INCORRECTLYREPORTED PRINCIPAL TRANSACTIONS AS "AGENT" TO THE FNTRF;REPORTED SOME PRINCIPAL TRANSACTIONS AS "AGENT" TO THEFINRA/OTC TRADE REPORTING FACILITY (OTCRF), AND INACCURATELYREPORTED A FEW RISKLESS PRINCIPAL TRANSACTIONS AS "PRINCIPAL"TO THE FNTRF. THE FIRM FAILED TO REPORT TO THE FNTRF THECORRECT SYMBOL INDICATING WHETHER TRANSACTIONS WERE A BUY,SELL OR CROSS IN SHORT SALE TRANSACTIONS AND TO REPORT TO THEOTCRF THE CORRECT SYMBOL INDICATING WHETHER THE TRANSACTIONWAS A BUY, SELL OR CROSS IN A FEW SHORT SALE TRANSACTIONS. THEFIRM FAILED TO SHOW THE TERMS AND CONDITIONS ON ORDERMEMORANDUM; TO SHOW THE CORRECT EXECUTION TIME ON SOMEORDER MEMORANDUM; AND TO DOCUMENT TWO TRANSACTIONS ON ITSTRADING LEDGER. THE FIRM FAILED TO PROVIDE WRITTEN NOTIFICATIONDISCLOSING TO ITS CUSTOMERS THAT TRANSACTIONS WERE EXECUTEDAT AN AVERAGE PRICE AND TO PROVIDE WRITTEN NOTIFICATIONDISCLOSING TO ITS CUSTOMERS THE CORRECT CAPACITY AND CORRECTCOMPENSATION TYPE IN TRANSACTIONS. THE FIRM FAILED TO SELLCORPORATE BONDS AT A PRICE THAT WAS FAIR, TAKING INTOCONSIDERATION ALL RELEVANT CIRCUMSTANCES. FOR A MONTH, THEFIRM MADE AVAILABLE A REPORT ON COVERED ORDERS IN NMSSECURITIES IT RECEIVED FOR EXECUTION WHICH INCLUDED INCORRECTINFORMATION REGARDING NUMBER OF CANCELLED SHARES, AVERAGEREALIZED SPREAD, AVERAGE EFFECTIVE SPREAD, PRICE-IMPROVEDAVERAGE TIME, NUMBER OF AT-THE-QUOTE SHARES, AT-THE-QUOTEAVERAGE TIME, NUMBER OF OUTSIDE-THE-QUOTE SHARES, OUTSIDE-THE-QUOTE AVERAGE AMOUNT, AND OUTSIDE-THE-QUOTE AVERAGETIME. THE FIRM FAILED TO ESTABLISH, MAINTAIN AND ENFORCE WSPS TODO THE FOLLOWING: ACHIEVE COMPLIANCE WITH APPLICABLE RULESCONCERNING TRADE REPORTING, SHORT SALE REPORTING, TRADINGDURING A TRADING HALT, AND BOOKS AND RECORDS; REASONABLYPREVENT TRADE-THROUGHS OF PROTECTED QUOTATIONS IN NMSSTOCKS THAT DO NOT FALL WITHIN ANY APPLICABLE EXCEPTION, AND IFRELYING ON AN EXCEPTION, ARE REASONABLY DESIGNED TO ASSURECOMPLIANCE WITH THE TERMS OF THE EXCEPTION; ACHIEVECOMPLIANCE WITH SEC RULE 611(C) OF REGULATION NMS; PROVIDE FORTHE SPECIFIC STEPS REQUIRED TO COMPLY WITH THE SELF-HELPEXEMPTION OF SEC RULE 611; ACHIEVE COMPLIANCE WITH APPLICABLERULES ADDRESSING QUALITY OF MARKET TOPICS; AND PROVIDE FORMINIMUM REQUIREMENTS FOR ADEQUATE WSPS IN SHORT SALEREPORTING, ORDER HANDLING AND OATS REPORTING.











Other Product Type(s): DESIGNATED SECURITIES, TRACE-ELIGIBLE SECURITIES, NATIONALMARKET SYSTEM SECURITIES.


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED, FINED $95,000, REQUIRED TO PAY$10,123.33, PLUS INTEREST, IN RESTITUTION TO INVESTORS AND REVISEITS WSPS REGARDING TRADE REPORTING, SHORT SALE REPORTING,TRADING DURING A TRADING HALT, BOOKS AND RECORDS, PREVENTINGTRADE-THROUGHS OF PROTECTED QUOTATIONS IN NMS STOCKS THATDO NOT FALL WITHIN ANY APPLICABLE EXCEPTION, AND IF RELYING ON ANEXCEPTION, ARE REASONABLY DESIGNED TO ASSURE COMPLIANCE WITHTHE TERMS OF THE EXCEPTION, THE SPECIFIC STEPS REQUIRED TOCOMPLY WITH THE SELF-HELP EXEMPTION OF SEC RULE 611, SHORTSALE REPORTING, ORDER HANDLING AND OATS REPORTING WITHIN 30BUSINESS DAYS OF ACCEPTANCE OF THIS AWC BY THE NAC. THE FIRMSHALL SUBMIT SATISFACTORY PROOF OF PAYMENT OF THE RESTITUTIONOR OF REASONABLE AND DOCUMENTED EFFORTS UNDERTAKEN TOEFFECT RESTITUTION TO FINRA NO LATER THAN 120 DAYS AFTERACCEPTANCE OF THIS AWC. ANY UNDISTRIBUTED RESTITUTION ANDINTEREST SHALL BE FORWARDED TO THE APPROPRIATE ESCHEAT,UNCLAIMED PROPERTY OR ABANDONED PROPERTY FUND FOR THESTATE IN WHICH THE CUSTOMER LAST RESIDED.



Disclosure 16 of 27

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Allegations: ON MAY 7, 2008, ON 4 SEPARATE OCCASIONS, MAXIM ENTERED ORDERSON THE EXCHANGE REPRESENTING A COMBINED TOTAL OF 2,000CONTRACTS WITH INCORRECT INFORMATION REGARDING ACCOUNTTYPE. THIS CONSTITUTES 4 DISTINCT VIOLATIONS OF ISE RULE 712.








Initiated By: INTERNATIONAL SECURITIES EXCHANGE


Restitution



Docket/Case Number: 2008-133

Principal Product Type: Options


Allegations: ON MAY 7, 2008, ON 4 SEPARATE OCCASIONS, MAXIM ENTERED ORDERSON THE EXCHANGE REPRESENTING A COMBINED TOTAL OF 2,000CONTRACTS WITH INCORRECT INFORMATION REGARDING ACCOUNTTYPE. THIS CONSTITUTES 4 DISTINCT VIOLATIONS OF ISE RULE 712.


Resolution:


Sanction Details: FINE OF $1000 AND A RESTITUTION OF $360 FOR UNPAID EXECUTION FEES

Sanctions Ordered: Monetary/Fine $1,000.00Disgorgement/Restitution


Disclosure 17 of 27

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Initiated By: STATE OF ILLINOIS, ILLINOIS SECURITIES DEPARTMENT


Prohibition



URL for Regulatory Action:



Allegations: RESPONDENT FAILED TO SUPERVISE SALESMAN WHO WAS CHURNINGACCOUNT OF ELDERLY COUPLE.








Prohibition


NOTICE OF HEARING


Resolution:


Sanction Details: CONSENT ORDER

Regulator Statement THE NOTICE OF HEARING WAS ISSUED MARCH 28, 2011. CONSENT ORDERWAS ISSUED JULY 28, 2011. RESPONDENT MAXIM STIPULATED TO ENTRYOF A CONSENT ORDER OF CENSURE, FINE AND RESTITUTION.QUESTIONS/INFORAMTION SHOULD BE DIRECTED TO JIM TIERNEY AT 312-793-9650


No

Sanctions Ordered:

Order


Initiated By: STATE OF ILLINOIS, ILLINOIS SECURITIES DEPARTMENT.


Suspension


POSSIBLE IMPOSITION OF MONETARY FINES, SUSPENSION ORREVOCATION OF DEALER LICENSE.





Allegations: MAXIM, THROUGH ONE OF ITS AGENTS, ALLEGEDLY EXCESSIVELYTRADED A JOINT ACCOUNT HELD BY TWO ELDERLY ILLINOIS RESIDENTS.


Resolution: Order 63©2020 FINRA. All rights reserved. Report about MAXIM GROUP LLC






Resolution:


Sanction Details: CONSENT ORDER

Firm Statement THE FIRM STIPULATED TO ENTRY OF A CONSENT ORDER OF CENSURE,FINE AND RESTITUTION.


Order

Disclosure 18 of 27

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Allegations: SEC RULE 203(B)(1) OF REGULATION SHO, SEC RULE 606 OF REGULATIONNMS, FINRA RULES 2010, 7450(A), NASD RULES 2110, 2111(A), 2320, 3010,4632(A), 4632(A)(5)(G), 6955(A) - MAXIM GROUP LLC, IN TRANSACTIONS FOROR WITH A CUSTOMER, FAILED TO USE REASONABLE DILIGENCE TOASCERTAIN THE BEST INTER-DEALER MARKET AND BUY OR SELL IN SUCHMARKET SO THAT THE RESULTANT PRICE TO ITS CUSTOMERS WAS ASFAVORABLE AS POSSIBLE UNDER PREVAILING MARKET CONDITIONS. THEFIRM FAILED TO EXECUTE ORDERS FULLY AND PROMPTLY. THE FIRMFAILED, WITHIN 90 SECONDS AFTER EXECUTION, TO TRANSMIT TO THEFINRA/NASDAQ TRADE REPORTING FACILITY (FNTRF) LAST SALEREPORTS OF TRANSACTIONS IN DESIGNATED SECURITIES AND FAILED TODESIGNATE THROUGH THE FNTRF SOME OF THE LAST SALE REPORTS ASLATE. THE LATE TRANSACTION REPORTING CONSTITUTES SEPARATE ANDDISTINCT VIOLATIONS OF NASD RULE 4632(A) AND A PATTERN ORPRACTICE OF LATE REPORTING WITHOUT EXCEPTIONALCIRCUMSTANCES IN VIOLATION OF NASD RULE 2110. THE FIRMINCORRECTLY DESIGNATED AS ".PRP" TO THE FNTRF LAST SALEREPORTS OF TRANSACTIONS IN DESIGNATED SECURITIES. THE FIRMFAILED TO TIMELY REPORT REPORTABLE ORDER EVENTS (ROES) TO THEORDER AUDIT TRAIL SYSTEM (OATS); TRANSMITTED ROUTE ORCOMBINED ORDER/ROUTE REPORTS TO OATS THAT THE OATS SYSTEMWAS UNABLE TO LINK TO THE RELATED ORDER ROUTED TO NASDAQ DUETO INACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;TRANSMITTED ROUTE OR COMBINED ORDER/ROUTE REPORTS TO OATSTHAT THE OATS SYSTEM WAS UNABLE TO LINK TO THE CORRESPONDINGNEW ORDER TRANSMITTED BY THE DESTINATION MEMBER FIRM DUE TOINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;TRANSMITTED EXECUTION REPORTS TO OATS THAT CONTAINEDINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA; ANDTRANSMITTED NEW ORDER REPORTS AND RELATED SUBSEQUENTREPORTS TO OATS WHERE THE TIMESTAMP FOR THE RELATEDSUBSEQUENT REPORT OCCURRED PRIOR TO THE RECEIPT OF THEORDER. THE FIRM TRANSMITTED REPORTS TO OATS THAT CONTAINEDINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA. THE FIRMACCEPTED SHORT SALE ORDERS IN AN EQUITY SECURITY FROMANOTHER PERSON, OR EFFECTED A SHORT SALE IN AN EQUITY SECURITYFOR ITS OWN ACCOUNT WITHOUT BORROWING THE SECURITY, ORENTERING INTO A BONA FIDE ARRANGEMENT TO BORROW THE SECURITY;OR HAVING REASONABLE GROUNDS TO BELIEVE THAT THE SECURITYCOULD BE BORROWED SO THAT IT COULD BE DELIVERED ON THE DATEDELIVERY IS DUE; AND DOCUMENTING COMPLIANCE WITH SEC RULE203(B)(1) OF REGULATION SHO. THE FIRM MADE PUBLICLY AVAILABLE AREPORT ON ITS ROUTING OF NON-DIRECTED ORDERS IN COVEREDSECURITIES DURING A CALENDAR QUARTER THAT INCLUDEDINCOMPLETE INFORMATION AS TO ITS ROUTING VENUES. THE FIRM'SSUPERVISORY SYSTEM DID NOT PROVIDE FOR SUPERVISIONREASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITH APPLICABLESECURITIES LAWS, REGULATIONS AN FINRA RULES CONCERNING ORDERHANDLING, SHORT SALE TRANSACTIONS, AND CLEARLY ERRONEOUSTRADE FILINGS.







Initiated By: FINRA






Other Product Type(s): DESIGNATED SECURITIES, EQUITY SECURITIES, COVERED SECURITIES

SEC RULE 203(B)(1) OF REGULATION SHO, SEC RULE 606 OF REGULATIONNMS, FINRA RULES 2010, 7450(A), NASD RULES 2110, 2111(A), 2320, 3010,4632(A), 4632(A)(5)(G), 6955(A) - MAXIM GROUP LLC, IN TRANSACTIONS FOROR WITH A CUSTOMER, FAILED TO USE REASONABLE DILIGENCE TOASCERTAIN THE BEST INTER-DEALER MARKET AND BUY OR SELL IN SUCHMARKET SO THAT THE RESULTANT PRICE TO ITS CUSTOMERS WAS ASFAVORABLE AS POSSIBLE UNDER PREVAILING MARKET CONDITIONS. THEFIRM FAILED TO EXECUTE ORDERS FULLY AND PROMPTLY. THE FIRMFAILED, WITHIN 90 SECONDS AFTER EXECUTION, TO TRANSMIT TO THEFINRA/NASDAQ TRADE REPORTING FACILITY (FNTRF) LAST SALEREPORTS OF TRANSACTIONS IN DESIGNATED SECURITIES AND FAILED TODESIGNATE THROUGH THE FNTRF SOME OF THE LAST SALE REPORTS ASLATE. THE LATE TRANSACTION REPORTING CONSTITUTES SEPARATE ANDDISTINCT VIOLATIONS OF NASD RULE 4632(A) AND A PATTERN ORPRACTICE OF LATE REPORTING WITHOUT EXCEPTIONALCIRCUMSTANCES IN VIOLATION OF NASD RULE 2110. THE FIRMINCORRECTLY DESIGNATED AS ".PRP" TO THE FNTRF LAST SALEREPORTS OF TRANSACTIONS IN DESIGNATED SECURITIES. THE FIRMFAILED TO TIMELY REPORT REPORTABLE ORDER EVENTS (ROES) TO THEORDER AUDIT TRAIL SYSTEM (OATS); TRANSMITTED ROUTE ORCOMBINED ORDER/ROUTE REPORTS TO OATS THAT THE OATS SYSTEMWAS UNABLE TO LINK TO THE RELATED ORDER ROUTED TO NASDAQ DUETO INACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;TRANSMITTED ROUTE OR COMBINED ORDER/ROUTE REPORTS TO OATSTHAT THE OATS SYSTEM WAS UNABLE TO LINK TO THE CORRESPONDINGNEW ORDER TRANSMITTED BY THE DESTINATION MEMBER FIRM DUE TOINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;TRANSMITTED EXECUTION REPORTS TO OATS THAT CONTAINEDINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA; ANDTRANSMITTED NEW ORDER REPORTS AND RELATED SUBSEQUENTREPORTS TO OATS WHERE THE TIMESTAMP FOR THE RELATEDSUBSEQUENT REPORT OCCURRED PRIOR TO THE RECEIPT OF THEORDER. THE FIRM TRANSMITTED REPORTS TO OATS THAT CONTAINEDINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA. THE FIRMACCEPTED SHORT SALE ORDERS IN AN EQUITY SECURITY FROMANOTHER PERSON, OR EFFECTED A SHORT SALE IN AN EQUITY SECURITYFOR ITS OWN ACCOUNT WITHOUT BORROWING THE SECURITY, ORENTERING INTO A BONA FIDE ARRANGEMENT TO BORROW THE SECURITY;OR HAVING REASONABLE GROUNDS TO BELIEVE THAT THE SECURITYCOULD BE BORROWED SO THAT IT COULD BE DELIVERED ON THE DATEDELIVERY IS DUE; AND DOCUMENTING COMPLIANCE WITH SEC RULE203(B)(1) OF REGULATION SHO. THE FIRM MADE PUBLICLY AVAILABLE AREPORT ON ITS ROUTING OF NON-DIRECTED ORDERS IN COVEREDSECURITIES DURING A CALENDAR QUARTER THAT INCLUDEDINCOMPLETE INFORMATION AS TO ITS ROUTING VENUES. THE FIRM'SSUPERVISORY SYSTEM DID NOT PROVIDE FOR SUPERVISIONREASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITH APPLICABLESECURITIES LAWS, REGULATIONS AN FINRA RULES CONCERNING ORDERHANDLING, SHORT SALE TRANSACTIONS, AND CLEARLY ERRONEOUSTRADE FILINGS.


Resolution:


No









Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED, FINED $75,000, REQUIRED TO MAKERESTITUTION OF $2,762.96, PLUS INTEREST, TO INVESTORS, AND REVISEITS WRITTEN SUPERVISORY PROCEDURES REGARDING ORDERHANDLING, SHORT SALE TRANSACTIONS, AND CLEARLY ERRONEOUSTRADE FILINGS WITHIN 30 BUSINESS DAYS OF ACCEPTANCE OF THIS AWCBY THE NAC. A REGISTERED PRINCIPAL OF THE FIRM SHALL SUBMITSATISFACTORY PROOF OF PAYMENT OF THE RESTITUTION, OR OFREASONABLE AND DOCUMENTED EFFORTS UNDERTAKEN TO EFFECTRESTITUTION TO FINRA NO LATER THAN 120 DAYS AFTER ACCEPTANCEOF THIS AWC. ANY UNDISTRIBUTED RESTITUTION AND INTEREST SHALLBE FORWARDED TO THE APPROPRIATE ESCHEAT, UNCLAIMED PROPERTYOR ABANDONED PROPERTY FUNDS FOR THE STATE IN WHICH THECUSTOMER LAST RESIDED.



Allegations: ALLEGED VIOLATIONS OF THE FOLLOWING RULES - SEC RULE 203(B)(1) OFREGULATION SHO, SEC RULE 606 OF REGULATION NMS, FINRA RULES2010, 7450(A), NASD RULES 2110, 2111(A), 2320, 3010, 4632(A), 4632(A)(5)(G),6955(A) - FAILURE TO USE REASONABLE DILIGENCE TO ASCERTAIN THEBEST INTER-DEALER MARKET AND BUY OR SELL IN SUCH MARKET SOTHAT THE RESULTANT PRICE TO ITS CUSTOMERS WAS AS FAVORABLE ASPOSSIBLE UNDER PREVAILING MARKET CONDITIONS; FAILURE TOEXECUTE ORDERS FULLY AND PROMPTLY; FAILURE, WITHIN 90 SECONDSAFTER EXECUTION, TO TRANSMIT TO THE FINRA/NASDAQ TRADEREPORTING FACILITY (FNTRF) LAST SALE REPORTS OF TRANSACTIONS INDESIGNATED SECURITIES AND FAILURE TO DESIGNATE THROUGH THEFNTRF SOME OF THE LAST SALE REPORTS AS LATE; FAILURE TOCORRECTLY DESIGNATE AS ".PRP" TO THE FNTRF LAST SALE REPORTSOF TRANSACTIONS IN DESIGNATED SECURITIES; FAILURE TO TIMELYREPORT REPORTABLE ORDER EVENTS (ROES) TO THE ORDER AUDITTRAIL SYSTEM (OATS); TRANSMITTED ROUTE OR COMBINEDORDER/ROUTE REPORTS TO OATS THAT THE OATS SYSTEM WAS UNABLETO LINK TO THE RELATED ORDER ROUTED TO NASDAQ DUE TOINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;TRANSMITTED ROUTE OR COMBINED ORDER/ROUTE REPORTS TO OATSTHAT THE OATS SYSTEM WAS UNABLE TO LINK TO THE CORRESPONDINGNEW ORDER TRANSMITTED BY THE DESTINATION MEMBER FIRM DUE TOINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;TRANSMITTED EXECUTION REPORTS TO OATS THAT CONTAINEDINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;TRANSMITTED NEW ORDER REPORTS AND RELATED SUBSEQUENTREPORTS TO OATS WHERE THE TIMESTAMP FOR THE RELATEDSUBSEQUENT REPORT OCCURRED PRIOR TO THE RECEIPT OF THEORDER; TRANSMITTED REPORTS TO OATS THAT CONTAINEDINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;ACCEPTED SHORT SALE ORDERS IN AN EQUITY SECURITY FROMANOTHER PERSON, OR EFFECTED A SHORT SALE IN AN EQUITY SECURITYFOR THE FIRM'S OWN ACCOUNT WITHOUT BORROWING THE SECURITY,OR ENTERING INTO A BONA FIDE ARRANGEMENT TO BORROW THESECURITY OR HAVING REASONABLE GROUNDS TO BELIEVE THAT THESECURITY COULD BE BORROWED SO THAT IT COULD BE DELIVERED ONTHE DATE DELIVERY IS DUE AND DOCUMENTING COMPLIANCE WITH SECRULE 203(B)(1) OF REGULATION SHO; FAILURE TO MAKE PUBLICLYAVAILABLE A CORRECT REPORT ON ITS ROUTING OF NON-DIRECTEDORDERS IN COVERED SECURITIES DURING A CALENDAR QUARTER;FAILURE TO MAINTAIN A SUPERVISORY SYSTEM REASONABLY DESIGNEDTO ACHIEVE COMPLIANCE WITH APPLICABLE SECURITIES LAWS,REGULATIONS AND FINRA RULES CONCERNING ORDER HANDLING,SHORT SALE TRANSACTIONS, AND CLEARLY ERRONEOUS TRADE FILINGS.







Initiated By: FINRA


Civil and Administrative Penalt(ies) /Fine(s)


AWC; FINE; CENSURE; UNDERTAKING; RESTITUTION





ALLEGED VIOLATIONS OF THE FOLLOWING RULES - SEC RULE 203(B)(1) OFREGULATION SHO, SEC RULE 606 OF REGULATION NMS, FINRA RULES2010, 7450(A), NASD RULES 2110, 2111(A), 2320, 3010, 4632(A), 4632(A)(5)(G),6955(A) - FAILURE TO USE REASONABLE DILIGENCE TO ASCERTAIN THEBEST INTER-DEALER MARKET AND BUY OR SELL IN SUCH MARKET SOTHAT THE RESULTANT PRICE TO ITS CUSTOMERS WAS AS FAVORABLE ASPOSSIBLE UNDER PREVAILING MARKET CONDITIONS; FAILURE TOEXECUTE ORDERS FULLY AND PROMPTLY; FAILURE, WITHIN 90 SECONDSAFTER EXECUTION, TO TRANSMIT TO THE FINRA/NASDAQ TRADEREPORTING FACILITY (FNTRF) LAST SALE REPORTS OF TRANSACTIONS INDESIGNATED SECURITIES AND FAILURE TO DESIGNATE THROUGH THEFNTRF SOME OF THE LAST SALE REPORTS AS LATE; FAILURE TOCORRECTLY DESIGNATE AS ".PRP" TO THE FNTRF LAST SALE REPORTSOF TRANSACTIONS IN DESIGNATED SECURITIES; FAILURE TO TIMELYREPORT REPORTABLE ORDER EVENTS (ROES) TO THE ORDER AUDITTRAIL SYSTEM (OATS); TRANSMITTED ROUTE OR COMBINEDORDER/ROUTE REPORTS TO OATS THAT THE OATS SYSTEM WAS UNABLETO LINK TO THE RELATED ORDER ROUTED TO NASDAQ DUE TOINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;TRANSMITTED ROUTE OR COMBINED ORDER/ROUTE REPORTS TO OATSTHAT THE OATS SYSTEM WAS UNABLE TO LINK TO THE CORRESPONDINGNEW ORDER TRANSMITTED BY THE DESTINATION MEMBER FIRM DUE TOINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;TRANSMITTED EXECUTION REPORTS TO OATS THAT CONTAINEDINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;TRANSMITTED NEW ORDER REPORTS AND RELATED SUBSEQUENTREPORTS TO OATS WHERE THE TIMESTAMP FOR THE RELATEDSUBSEQUENT REPORT OCCURRED PRIOR TO THE RECEIPT OF THEORDER; TRANSMITTED REPORTS TO OATS THAT CONTAINEDINACCURATE, INCOMPLETE OR IMPROPERLY FORMATTED DATA;ACCEPTED SHORT SALE ORDERS IN AN EQUITY SECURITY FROMANOTHER PERSON, OR EFFECTED A SHORT SALE IN AN EQUITY SECURITYFOR THE FIRM'S OWN ACCOUNT WITHOUT BORROWING THE SECURITY,OR ENTERING INTO A BONA FIDE ARRANGEMENT TO BORROW THESECURITY OR HAVING REASONABLE GROUNDS TO BELIEVE THAT THESECURITY COULD BE BORROWED SO THAT IT COULD BE DELIVERED ONTHE DATE DELIVERY IS DUE AND DOCUMENTING COMPLIANCE WITH SECRULE 203(B)(1) OF REGULATION SHO; FAILURE TO MAKE PUBLICLYAVAILABLE A CORRECT REPORT ON ITS ROUTING OF NON-DIRECTEDORDERS IN COVERED SECURITIES DURING A CALENDAR QUARTER;FAILURE TO MAINTAIN A SUPERVISORY SYSTEM REASONABLY DESIGNEDTO ACHIEVE COMPLIANCE WITH APPLICABLE SECURITIES LAWS,REGULATIONS AND FINRA RULES CONCERNING ORDER HANDLING,SHORT SALE TRANSACTIONS, AND CLEARLY ERRONEOUS TRADE FILINGS.


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED, FINED $75K, REQUIRED TO MAKERESTITUTION OF $2,762.96, PLUS INTEREST, TO INVESTORS, AND REVISEITS SUPERVISORY WRITTEN SUPERVISORY PROCEDURES REGARDINGORDER HANDLING, SHORT SALE TRANSACTIONS, AND CLEARLYERRONEOUS TRADE FILINGS WITHIN 30 BUSINESS DAYS OF ACCEPTANCEOF THIS AWC BY THE NAC. A REGISTERED PRINCIPAL OF THE FIRM SHALLSUBMIT SATISFACTORY PROOF OF PAYMENT OF THE RESTITUTION, OR OFREASONABLE AND DOCUMENTED EFFORTS UNDERTAKEN TO EFFECTRESTITUTION TO FINRA NO LATER THAN 120 DAYS AFTER ACCEPTANCEOF THIS AWC. ANY UNDISTRIBUTED RESTITUTION AND INTEREST SHALLBE FORWARDED TO THE APPROPRIATE ESCHEAT, UNCLAIMED PROPERTYOR ABANDONED PROPERTY FUNDS FOR THE STATE IN WHICH THECUSTOMER LAST RESIDED.









Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED, FINED $75K, REQUIRED TO MAKERESTITUTION OF $2,762.96, PLUS INTEREST, TO INVESTORS, AND REVISEITS SUPERVISORY WRITTEN SUPERVISORY PROCEDURES REGARDINGORDER HANDLING, SHORT SALE TRANSACTIONS, AND CLEARLYERRONEOUS TRADE FILINGS WITHIN 30 BUSINESS DAYS OF ACCEPTANCEOF THIS AWC BY THE NAC. A REGISTERED PRINCIPAL OF THE FIRM SHALLSUBMIT SATISFACTORY PROOF OF PAYMENT OF THE RESTITUTION, OR OFREASONABLE AND DOCUMENTED EFFORTS UNDERTAKEN TO EFFECTRESTITUTION TO FINRA NO LATER THAN 120 DAYS AFTER ACCEPTANCEOF THIS AWC. ANY UNDISTRIBUTED RESTITUTION AND INTEREST SHALLBE FORWARDED TO THE APPROPRIATE ESCHEAT, UNCLAIMED PROPERTYOR ABANDONED PROPERTY FUNDS FOR THE STATE IN WHICH THECUSTOMER LAST RESIDED.

Disclosure 19 of 27

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Other Product Type(s): UNSPECIFIED SECURITIES

Allegations: NASDAQ RULE 4755 - MAXIM GROUP LLC ENTERED ORDERS INTO THENASDAQ MARKET CENTER THAT FAILED TO CORRECTLY INDICATEWHETHER THE ORDERS WERE A BUY, SHORT SALE OR LONG SALE.



Resolution:


No








Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTION AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM WAS FINED $5,000.


No



Initiated By: NASDAQ


Other


NASDAQ; AWC; FINE


Docket/Case Number: AWC NO. 20060047891-02


Other Product Type(s): NASDAQ SECURITIES

Allegations: NASDAQ RULE 4755 - FAILURE TO CORRECTLY INDICATE WHETHERORDERS WERE BUYS; SHORT SALES OR LONG SALES.



Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLCCONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS, THEREFORE, THE FIRM IS FINED $5,000.



Disclosure 20 of 27

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Disclosure 20 of 27


Allegations: SEC RULES 200(G) 203(B)(1) OF REGULATION SHO, NASD RULES 2110,2111(A), 2320, 2440, 3010, 4632, 6420, 6130, 6130(D), 6620, 6955(A),INTERPRETATIVE MATERIAL 2440 - MAXIM GROUP LLC INCORRECTLYREPORTED TO THE NASDAQ MARKET CENTER (NMC) RISKLESS PRINCIPALTRANSACTIONS IN DESIGNATED SECURITIES IN A PRINCIPAL CAPACITY;REPORTED TO THE NMC THE SECOND LEG OF RISKLESS PRINCIPALTRANSACTIONS AND INCORRECTLY REPORTED TO THE OTC REPORTINGFACILITY THE SECOND LEG OF PRINCIPAL TRANSACTIONS IN DESIGNATEDSECURITIES BECAUSE IT INCORRECTLY DESIGNATED THE CAPACITY OFSUCH TRANSACTIONS AS PRINCIPAL. THE FIRM FAILED TO REPORT TOTHE NMC THE CORRECT SYMBOL INDICATING WHETHER IT EXECUTEDTRANSACTIONS IN REPORTABLE SECURITIES IN A PRINCIPAL OR AGENCYCAPACITY. THE FIRM TRANSMITTED TO THE ORDER AUDIT TRANSACTIONSYSTEM (OATS)EXECUTION REPORTS THAT CONTAINED INACCURATE,INCOMPLETE OR IMPROPERLY FORMATTED DATA; THE FIRM EXECUTEDSHORT SALE ORDERS AND FAILED TO PROPERLY MARK THE ORDERS ASSHORT. THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDE FORSUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITHAPPLICABLE SECURITIES LAWS, REGULATIONS AND/OR APPLICABLE SECOR NASD RULES ADDRESSING QUALITY OF MARKETS TOPICS. THE FIRM'SWRITTEN SUPERVISORY PROCEDURES FAILED TO PROVIDE FOR MINIMUMREQUIREMENTS FOR ADEQUATE WRITTEN SUPERVISORY PROCEDURESIN TRADE REPORTING, OATS REPORTING, BEST EXECUTION, BACKINGAWAY, AND SHORT SALE REPORTING. THE FIRM ACCEPTED SHORT SALEORDERS IN AN EQUITY SECURITY FROM ANOTHER PERSON, OREFFECTED SHORT SALES IN AN EQUITY SECURITY FOR ITS OWNACCOUNT WITHOUT BORROWING THE SECURITY, OR ENTERING INTO ABONA FIDE ARRANGEMENT TO BORROW THE SECURITY; OR HAVINGREASONABLE GROUNDS TO BELIEVE THAT THE SECURITY COULD BEBORROWED SO THAT IT COULD BE DELIVERED ON THE DATE DELIVERY ISDUE; AND DOCUMENTING COMPLIANCE WITH SEC RULE 203(B)(1) OFREGULATION SHO. IN TRANSACTIONS FOR OR WITH CUSTOMERS, THEFIRM FAILED TO USE REASONABLE DILIGENCE TO ASCERTAIN THE BESTINTER-DEALER MARKET AND BUY OR SELL IN SUCH MARKET SO THAT THERESULTANT PRICE TO ITS CUSTOMERS WAS AS FAVORABLE AS POSSIBLEUNDER PREVAILING MARKET CONDITIONS. THE FIRM FAILED TO EXECUTEORDERS FULLY AND PROMPTLY. THE FIRM BOUGHT OR SOLD CORPORATEBONDS TO AND FROM CUSTOMERS AND FAILED TO SELL OR BUY THEBONDS AT A PRICE THAT WAS FAIR, TAKING INTO CONSIDERATION ALLRELEVANT CIRCUMSTANCES, INCLUDING MARKET CONDITIONS WITHRESPECT TO EACH CORPORATE BOND AT THE TIME OF THETRANSACTION, THE EXPENSE INVOLVED AND THAT THE FIRM WASENTITLED TO A PROFIT. THE FIRM FAILED TO REPORT TO THE OTCREPORTING FACILITY THE CORRECT SYMBOL INDICATING WHETHERTRANSACTIONS WERE BUY, SELL, SELL SHORT OR CROSS FORTRANSACTIONS IN REPORTABLE SECURITIES; THE FIRM FAILED TOREPORT TO THE NASD/NASDAQ TRADE REPORTING FACILITY (NNTRF) THECONTRA SIDE EXECUTING BROKER IN TRANSACTIONS IN REPORTABLESECURITIES. THE FIRM FAILED TO REPORT TO THE NNTRF THE CORRECTSYMBOL INDICATING WHETHER IT EXECUTED TRANSACTIONS INREPORTABLE SECURITIES IN A PRINCIPAL OR AGENCY CAPACITY; THEFIRM IMPROPERLY AGGREGATED INTO A SINGLE TRANSACTION REPORT,INDIVIDUAL EXECUTIONS OF ORDERS IN OTC EQUITY SECURITIES. THEFIRM FAILED TO REPORT TO THE NNTRF THE CORRECT SYMBOLINDICATING WHETHER IT EXECUTED TRANSACTIONS IN REPORTABLESECURITIES IN A PRINCIPAL OR AGENCY CAPACITY.







Initiated By: FINRA






Other Product Type(s): DESIGNATED SECURITIES, REPORTABLE SECURITIES, CORPORATEBONDS -

SEC RULES 200(G) 203(B)(1) OF REGULATION SHO, NASD RULES 2110,2111(A), 2320, 2440, 3010, 4632, 6420, 6130, 6130(D), 6620, 6955(A),INTERPRETATIVE MATERIAL 2440 - MAXIM GROUP LLC INCORRECTLYREPORTED TO THE NASDAQ MARKET CENTER (NMC) RISKLESS PRINCIPALTRANSACTIONS IN DESIGNATED SECURITIES IN A PRINCIPAL CAPACITY;REPORTED TO THE NMC THE SECOND LEG OF RISKLESS PRINCIPALTRANSACTIONS AND INCORRECTLY REPORTED TO THE OTC REPORTINGFACILITY THE SECOND LEG OF PRINCIPAL TRANSACTIONS IN DESIGNATEDSECURITIES BECAUSE IT INCORRECTLY DESIGNATED THE CAPACITY OFSUCH TRANSACTIONS AS PRINCIPAL. THE FIRM FAILED TO REPORT TOTHE NMC THE CORRECT SYMBOL INDICATING WHETHER IT EXECUTEDTRANSACTIONS IN REPORTABLE SECURITIES IN A PRINCIPAL OR AGENCYCAPACITY. THE FIRM TRANSMITTED TO THE ORDER AUDIT TRANSACTIONSYSTEM (OATS)EXECUTION REPORTS THAT CONTAINED INACCURATE,INCOMPLETE OR IMPROPERLY FORMATTED DATA; THE FIRM EXECUTEDSHORT SALE ORDERS AND FAILED TO PROPERLY MARK THE ORDERS ASSHORT. THE FIRM'S SUPERVISORY SYSTEM DID NOT PROVIDE FORSUPERVISION REASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITHAPPLICABLE SECURITIES LAWS, REGULATIONS AND/OR APPLICABLE SECOR NASD RULES ADDRESSING QUALITY OF MARKETS TOPICS. THE FIRM'SWRITTEN SUPERVISORY PROCEDURES FAILED TO PROVIDE FOR MINIMUMREQUIREMENTS FOR ADEQUATE WRITTEN SUPERVISORY PROCEDURESIN TRADE REPORTING, OATS REPORTING, BEST EXECUTION, BACKINGAWAY, AND SHORT SALE REPORTING. THE FIRM ACCEPTED SHORT SALEORDERS IN AN EQUITY SECURITY FROM ANOTHER PERSON, OREFFECTED SHORT SALES IN AN EQUITY SECURITY FOR ITS OWNACCOUNT WITHOUT BORROWING THE SECURITY, OR ENTERING INTO ABONA FIDE ARRANGEMENT TO BORROW THE SECURITY; OR HAVINGREASONABLE GROUNDS TO BELIEVE THAT THE SECURITY COULD BEBORROWED SO THAT IT COULD BE DELIVERED ON THE DATE DELIVERY ISDUE; AND DOCUMENTING COMPLIANCE WITH SEC RULE 203(B)(1) OFREGULATION SHO. IN TRANSACTIONS FOR OR WITH CUSTOMERS, THEFIRM FAILED TO USE REASONABLE DILIGENCE TO ASCERTAIN THE BESTINTER-DEALER MARKET AND BUY OR SELL IN SUCH MARKET SO THAT THERESULTANT PRICE TO ITS CUSTOMERS WAS AS FAVORABLE AS POSSIBLEUNDER PREVAILING MARKET CONDITIONS. THE FIRM FAILED TO EXECUTEORDERS FULLY AND PROMPTLY. THE FIRM BOUGHT OR SOLD CORPORATEBONDS TO AND FROM CUSTOMERS AND FAILED TO SELL OR BUY THEBONDS AT A PRICE THAT WAS FAIR, TAKING INTO CONSIDERATION ALLRELEVANT CIRCUMSTANCES, INCLUDING MARKET CONDITIONS WITHRESPECT TO EACH CORPORATE BOND AT THE TIME OF THETRANSACTION, THE EXPENSE INVOLVED AND THAT THE FIRM WASENTITLED TO A PROFIT. THE FIRM FAILED TO REPORT TO THE OTCREPORTING FACILITY THE CORRECT SYMBOL INDICATING WHETHERTRANSACTIONS WERE BUY, SELL, SELL SHORT OR CROSS FORTRANSACTIONS IN REPORTABLE SECURITIES; THE FIRM FAILED TOREPORT TO THE NASD/NASDAQ TRADE REPORTING FACILITY (NNTRF) THECONTRA SIDE EXECUTING BROKER IN TRANSACTIONS IN REPORTABLESECURITIES. THE FIRM FAILED TO REPORT TO THE NNTRF THE CORRECTSYMBOL INDICATING WHETHER IT EXECUTED TRANSACTIONS INREPORTABLE SECURITIES IN A PRINCIPAL OR AGENCY CAPACITY; THEFIRM IMPROPERLY AGGREGATED INTO A SINGLE TRANSACTION REPORT,INDIVIDUAL EXECUTIONS OF ORDERS IN OTC EQUITY SECURITIES. THEFIRM FAILED TO REPORT TO THE NNTRF THE CORRECT SYMBOLINDICATING WHETHER IT EXECUTED TRANSACTIONS IN REPORTABLESECURITIES IN A PRINCIPAL OR AGENCY CAPACITY.


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED, FINED $82,500, ORDERED TO PAY$3,351.82, PLUS INTEREST, IN RESTITUTION TO INVESTORS AND TOREVISE ITS WRITTEN SUPERVISORY PROCEDURES REGARDING TRADEREPORTING, OATS REPORTING, BEST EXECUTION, BACKING AWAY, ANDSHORT SALE REPORTING WITHIN 30 BUSINESS DAYS OF ACCEPTANCE OFTHIS AWC BY THE NAC. A REGISTERED PRINCIPAL OF THE FIRM SHALLSUBMIT SATISFACTORY PROOF OF PAYMENT OF THE RESTITUTION, OR OFREASONABLE AND DOCUMENTED EFFORTS UNDERTAKEN TO EFFECTRESTITUTION TO FINRA NO LATER THAN 120 DAYS AFTER ACCEPTANCEOF THIS AWC. ANY UNDISTRIBUTED RESTITUTION AND INTEREST SHALLBE FORWARDED TO THE APPROPRIATE ESCHEAT, UNCLAIMED PROPERTYOR ABANDONED PROPERTY FUND FOR THE STATE IN WHICH THECUSTOMER LAST RESIDED.


No









Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED, FINED $82,500, ORDERED TO PAY$3,351.82, PLUS INTEREST, IN RESTITUTION TO INVESTORS AND TOREVISE ITS WRITTEN SUPERVISORY PROCEDURES REGARDING TRADEREPORTING, OATS REPORTING, BEST EXECUTION, BACKING AWAY, ANDSHORT SALE REPORTING WITHIN 30 BUSINESS DAYS OF ACCEPTANCE OFTHIS AWC BY THE NAC. A REGISTERED PRINCIPAL OF THE FIRM SHALLSUBMIT SATISFACTORY PROOF OF PAYMENT OF THE RESTITUTION, OR OFREASONABLE AND DOCUMENTED EFFORTS UNDERTAKEN TO EFFECTRESTITUTION TO FINRA NO LATER THAN 120 DAYS AFTER ACCEPTANCEOF THIS AWC. ANY UNDISTRIBUTED RESTITUTION AND INTEREST SHALLBE FORWARDED TO THE APPROPRIATE ESCHEAT, UNCLAIMED PROPERTYOR ABANDONED PROPERTY FUND FOR THE STATE IN WHICH THECUSTOMER LAST RESIDED.


Allegations: ALLEGED VIOLATIONS OF THE FOLLOWING RULES - NASD RULE 4632:INCORRECT REPORTING TO THE NASDAQ MARKET CENTER (NMC) OFRISKLESS PRINCIPAL TRANSACTIONS IN DESIGNATED SECURITIES; ANDFAILURE TO REPORT TO THE NASD/NASDAQ TRADE REPORTING FACILITY("TRF") THE CORRECT SYMBOL INDICATING PRINCIPAL OR AGENCYCAPACITY IN TRANSACTIONS IN REPORTABLE SECURITIES. NASD RULE6420: INCORRECT REPORTING TO THE NMC OF THE SECOND LEG OFRISKLESS PRINCIPAL TRANSACTIONS, AND INCORRECT REPORTING TOTHE OTC REPORTING FACILITY OF THE SECOND LEG OF RISKLESSPRINCIPAL TRANSACTIONS IN DESIGNATED SECURITIES. NASD RULE6130: FAILURE TO REPORT TO THE NMC THE CORRECT SYMBOL FOREXECUTION OF TRANSACTIONS IN REPORTABLE SECURITIES INPRINCIPAL OR AGENT CAPACITY. NASD RULE 6955(A): TRANSMITTAL TOOATS OF INACCURATE, INCOMPLETE, OR IMPROPERLY FORMATTED DATAIN EXECUTION REPORTS. SEC RULE 200(G) OF REGULATION SHO:FAILURE TO PROPERLY MARK SHORT SALE ORDERS AS SHORT. NASDCONDUCT RULES 2110 AND 3010: FAILURE TO PROVIDE ADEQUATEWRITTEN SUPERVISORY PROCEDURES FOR QUALITY OF MARKETSREQUIREMENTS IN THE FOLLOWING SUBJECT AREAS: TRADEREPORTING, OATS REPORTING, SHORT SALE REPORTING, BESTEXECUTION, AND BACKING AWAY; AND FAILURE TO HAVE ADEQUATEWRITTEN SUPERVISORY PROCEDURES PROVIDING FOR A STATEMENT ONHOW COMPLETION OF SHORT SALES SHOULD BE DOCUMENTED. SECRULE 203(B)(1) OF REGULATION SHO FOR SHORT SALE: FAILURE TOBORROW SECURITY OR ENTER INTO ARRANGEMENT TO BORROWSECURITY OR HAVE GROUNDS TO BELIEVE THAT SECURITY COULD BEBORROWED FOR TIMELY DELIVERY; AND FAILURE TO DOCUMENTCOMPLIANCE WITH RULE 203(B)(1). SEC RULE 200(G) OF REGULATIONSHO FOR SHORT SALE ORDERS: FAILURE TO PROPERLY MARK ORDERSAS SHORT. NASD CONDUCT RULES 2110 AND 2320: FAILURE TO USEREASONABLE DILIGENCE TO DETERMINE BEST INTER-DEALER MARKETAND BUY OR SELL IN SUCH MARKET TO OBTAIN PRICE MOST FAVORABLETO CUSTOMER. NASD CONDUCT RULES 2110 AND 2111(A): FAILURE TOEXECUTE ORDERS FULLY AND PROMPTLY. NASD CONDUCT RULES 2110AND 2440, AND IM-2440: FAILURE TO BUY OR SELL CORPORATE BONDS TOAND FROM CUSTOMERS AT A FAIR PRICE. NASD RULE 6130(D): FAILURETO REPORT TO OTC REPORTING FACILITY THE CORRECT SYMBOL FORBUY, SELL, SELL SHORT, OR CROSS FOR TRANSACTIONS IN REPORTABLESECURITIES, AND FAILURE TO REPORT TO THE NASD/NASDAQ TRADEREPORTING FACILITY ("TRF") THE CONTRA SIDE EXECUTING BROKER INTRANSACTIONS IN REPORTABLE SECURITIES. NASD RULE 6620: FAILURETO REPORT TO THE TRF THE CORRECT SYMBOL INDICATING PRINCIPALOR AGENCY CAPACITY IN TRANSACTIONS IN REPORTABLE SECURITIES,AND IMPROPER AGGREGATION INTO A SINGLE TRANSACTION REPORT OFTWO INDIVIDUAL EXECUTIONS OF ORDERS IN OTC EQUITY SECURITIES.







Initiated By: FINRA


Other


AWC; FINE; CENSURE; UNDERTAKING; RESTITUTION


Docket/Case Number: AWC NO. 20060047891-01



ALLEGED VIOLATIONS OF THE FOLLOWING RULES - NASD RULE 4632:INCORRECT REPORTING TO THE NASDAQ MARKET CENTER (NMC) OFRISKLESS PRINCIPAL TRANSACTIONS IN DESIGNATED SECURITIES; ANDFAILURE TO REPORT TO THE NASD/NASDAQ TRADE REPORTING FACILITY("TRF") THE CORRECT SYMBOL INDICATING PRINCIPAL OR AGENCYCAPACITY IN TRANSACTIONS IN REPORTABLE SECURITIES. NASD RULE6420: INCORRECT REPORTING TO THE NMC OF THE SECOND LEG OFRISKLESS PRINCIPAL TRANSACTIONS, AND INCORRECT REPORTING TOTHE OTC REPORTING FACILITY OF THE SECOND LEG OF RISKLESSPRINCIPAL TRANSACTIONS IN DESIGNATED SECURITIES. NASD RULE6130: FAILURE TO REPORT TO THE NMC THE CORRECT SYMBOL FOREXECUTION OF TRANSACTIONS IN REPORTABLE SECURITIES INPRINCIPAL OR AGENT CAPACITY. NASD RULE 6955(A): TRANSMITTAL TOOATS OF INACCURATE, INCOMPLETE, OR IMPROPERLY FORMATTED DATAIN EXECUTION REPORTS. SEC RULE 200(G) OF REGULATION SHO:FAILURE TO PROPERLY MARK SHORT SALE ORDERS AS SHORT. NASDCONDUCT RULES 2110 AND 3010: FAILURE TO PROVIDE ADEQUATEWRITTEN SUPERVISORY PROCEDURES FOR QUALITY OF MARKETSREQUIREMENTS IN THE FOLLOWING SUBJECT AREAS: TRADEREPORTING, OATS REPORTING, SHORT SALE REPORTING, BESTEXECUTION, AND BACKING AWAY; AND FAILURE TO HAVE ADEQUATEWRITTEN SUPERVISORY PROCEDURES PROVIDING FOR A STATEMENT ONHOW COMPLETION OF SHORT SALES SHOULD BE DOCUMENTED. SECRULE 203(B)(1) OF REGULATION SHO FOR SHORT SALE: FAILURE TOBORROW SECURITY OR ENTER INTO ARRANGEMENT TO BORROWSECURITY OR HAVE GROUNDS TO BELIEVE THAT SECURITY COULD BEBORROWED FOR TIMELY DELIVERY; AND FAILURE TO DOCUMENTCOMPLIANCE WITH RULE 203(B)(1). SEC RULE 200(G) OF REGULATIONSHO FOR SHORT SALE ORDERS: FAILURE TO PROPERLY MARK ORDERSAS SHORT. NASD CONDUCT RULES 2110 AND 2320: FAILURE TO USEREASONABLE DILIGENCE TO DETERMINE BEST INTER-DEALER MARKETAND BUY OR SELL IN SUCH MARKET TO OBTAIN PRICE MOST FAVORABLETO CUSTOMER. NASD CONDUCT RULES 2110 AND 2111(A): FAILURE TOEXECUTE ORDERS FULLY AND PROMPTLY. NASD CONDUCT RULES 2110AND 2440, AND IM-2440: FAILURE TO BUY OR SELL CORPORATE BONDS TOAND FROM CUSTOMERS AT A FAIR PRICE. NASD RULE 6130(D): FAILURETO REPORT TO OTC REPORTING FACILITY THE CORRECT SYMBOL FORBUY, SELL, SELL SHORT, OR CROSS FOR TRANSACTIONS IN REPORTABLESECURITIES, AND FAILURE TO REPORT TO THE NASD/NASDAQ TRADEREPORTING FACILITY ("TRF") THE CONTRA SIDE EXECUTING BROKER INTRANSACTIONS IN REPORTABLE SECURITIES. NASD RULE 6620: FAILURETO REPORT TO THE TRF THE CORRECT SYMBOL INDICATING PRINCIPALOR AGENCY CAPACITY IN TRANSACTIONS IN REPORTABLE SECURITIES,AND IMPROPER AGGREGATION INTO A SINGLE TRANSACTION REPORT OFTWO INDIVIDUAL EXECUTIONS OF ORDERS IN OTC EQUITY SECURITIES.


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLCCONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS; THEREFORE, THE FIRM IS CENSURED AND FINED $82,500,ORDERED TO PAY $3,351.82, PLUS INTEREST, IN RESTITUTION TOINVESTORS AND TO REVISE ITS WRITTEN SUPERVISORY PROCEDURESREGARDING TRADE REPORTING, OATS REPORTING, SHORT SALEREPORTING, BEST EXECUTION, BACKING AWAY, AND SHORT SALEREPORTING WITHIN 30 BUSINESS DAYS OF ACCEPTANCE OF THIS AWC BYTHE NAC. A REGISTERED PRINCIPAL OF THE FIRM SHALL SUBMITSATISFACTORY PROOF OF PAYMENT OF THE RESTITUTION, OR OFREASONABLE AND DOCUMENTED EFFORTS UNDERTAKEN TO EFFECTRESTITUTION TO FINRA NO LATER THAN 120 DAYS AFTER ACCEPTANCEOF THE AWC. ANY UNDISTRIBUTED RESTITUTION AND INTEREST SHALLBE FORWARDED TO THE APPROPRIATE ESCHEAT, UNCLAIMED PROPERTYOR ABANDONED PROPERTY FUND FOR THE STATE IN WHICH THECUSTOMER LAST RESIDED.







www.finra.org/brokercheck User GuidanceWITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLCCONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS; THEREFORE, THE FIRM IS CENSURED AND FINED $82,500,ORDERED TO PAY $3,351.82, PLUS INTEREST, IN RESTITUTION TOINVESTORS AND TO REVISE ITS WRITTEN SUPERVISORY PROCEDURESREGARDING TRADE REPORTING, OATS REPORTING, SHORT SALEREPORTING, BEST EXECUTION, BACKING AWAY, AND SHORT SALEREPORTING WITHIN 30 BUSINESS DAYS OF ACCEPTANCE OF THIS AWC BYTHE NAC. A REGISTERED PRINCIPAL OF THE FIRM SHALL SUBMITSATISFACTORY PROOF OF PAYMENT OF THE RESTITUTION, OR OFREASONABLE AND DOCUMENTED EFFORTS UNDERTAKEN TO EFFECTRESTITUTION TO FINRA NO LATER THAN 120 DAYS AFTER ACCEPTANCEOF THE AWC. ANY UNDISTRIBUTED RESTITUTION AND INTEREST SHALLBE FORWARDED TO THE APPROPRIATE ESCHEAT, UNCLAIMED PROPERTYOR ABANDONED PROPERTY FUND FOR THE STATE IN WHICH THECUSTOMER LAST RESIDED.

Disclosure 21 of 27

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Initiated By: FINRA






Other Product Type(s): TRACE-ELIGIBLE SECURITIES

Allegations: NASD RULES 2110, 6230(A) - MAXIM GROUP LLC FAILED TO REPORT TOTRACE TRANSACTIONS IN TRACE-ELIGIBLE SECURITIES EXECUTED ON ABUSINESS DAY DURING TRACE SYSTEM HOURS WITHIN 15 MINUTES OFTHE TIME OF EXECUTION.



Resolution:


No









Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED AND FINED $7,500.



Initiated By: FINANCIAL INDUSTRY REGULATORY AUTHORITY


Other


AWC; FINE; CENSURE




Other Product Type(s): TRACE - ELIGIBLE SECURITIES

Allegations: NASD MARKETPLACE RULE 6230(A) AND NASD CONDUCT RULE 2110 -RESPONDENT MEMBER FAILED TO REPORT A PERCENTAGE OF TRACE-ELIGIBLE TRANSACTIONS TO TRACE WITHIN THE PRESCRIBED TIMEPERIOD.



Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, MAXIM GROUP LLCCONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS, THEREFORE, THE FIRM IS CENSORED AND FINED $7500.00.PAID ON 01/28/2008.



Disclosure 22 of 27

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Initiated By: FINRA







Allegations: NASD RULE 6955(A) - RESPONDENT MEMBER SUBMITTED TO THE ORDERAUDIT TRAIL SYSTEM (OATS) REPORTS WITH RESPECT TO EQUITYSECURITIES TRADED ON THE NASDAQ STOCK MARKET THAT WERE NOTIN THE ELECTRONIC FORM PRESCRIBED BY FINRA AND WEREREPAIRABLE. THE FINDINGS STATED THAT THE SUBJECT REPORTS WEREREJECTED BY THE OATS SYSTEM AND NOTICE OF SUCH REJECTION WASMADE AVAILABLE TO THE FIRM ON THE OATS WEBSITE BUT THE FIRM DIDNOT CORRECT ALL OF THE REPORTS.



Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, MAXIM GROUP LLC,CONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS, THEREFORE, THE FIRM IS CENSURED AND FINED $12,500.


No









Initiated By: FINRA


Other


AWC; FINE; CENSURE





Allegations: NASD RULE 6955(A) - RESPONDENT MEMBER SUBMITTED TO THE ORDERAUDIT TRAIL SYSTEM (OATS) REPORTS WITH RESPECT TO EQUITYSECURITIES TRADED ON THE NASDAQ STOCK MARKET THAT WERE NOTIN THE ELECTRONIC FORM PRESCRIBED BY FINRA AND WEREREPAIRABLE. THE FINDINGS STATED THAT THE SUBJECT REPORTS WEREREJECTED BY THE OATS SYSTEM AND NOTICE OF SUCH REJECTION WASMADE AVAILABLE TO THE FIRM ON THE OATS WEBSITE BUT THE FIRM DIDNOT CORRECT ALL OF THE REPORTS.



Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, MAXIM GROUP LLC,CONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS, THEREFORE, THE FIRM IS CENSURED AND FINED $12,500.00.



Disclosure 23 of 27

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Allegations: SEC RULES 10A-1, 10B-10, 17A-3, 605, NASD RULES 2110, 3010, 3110, 6130 -RESPONDENT FIRM FAILED TO SHOW CUSTOMER POSITIONS AS LONG ORSHORT ON THE MEMORANDUM OF BROKERAGE ORDERS FOR LISTEDSECURITIES. THE FINDINGS STATED THAT THE FIRM EXECUTED SHORTSALE TRANSACTIONS AND FAILED TO REPORT THEM TO THE NASDAQMARKET CENTER WITH A SHORT SALE MODIFIER AND FAILED TO PROVIDEWRITTEN NOTIFICATION TO ITS CUSTOMERS ITS CORRECT CAPACITY INTHE TRANSACTION. THE FINDINGS ALSO STATED THAT THE FIRM MADEAVAILABLE A REPORT ON THE COVERED ORDERS IN NATIONAL MARKETSYSTEM SECURITIES THAT IT RECEIVED FOR EXECUTION FROM ANYPERSON THAT INCORRECTLY DISCLOSED THE CORRECT "MARKETCENTER EXECUTED SHARES" AND THE "EXECUTED AWAY SHARES" ANDCOULD NOT DEMONSTRATE IF THE ORDERS WERE COVERED OR NOTCOVERED. THE FINDINGS ALSO INCLUDED THAT THE FIRM FAILED TOSHOW THE CORRECT TIME OF ENTRY AND FAILED TO SHOW THE TERMSAND CONDITIONS ON THE MEMORANDUM OF BROKERAGE ORDERS. NASDFOUND THAT THE FIRM FAILED TO ESTABLISH, MAINTAIN AND/ORENFORCE ADEQUATE WRITTEN SUPERVISORY PROCEDURES REGARDINGQUALIFICATION OF PERSONNEL, LIMIT ORDER DISPLAY, LIMIT ORDERPROTECTION, "REGULAR AND RIGOROUS" REVIEW, THREE QUOTE RULE,RISKLESS PRINCIPAL TRANSACTION REPORTING, TRADE REPORTING,ACCEPTING OR DECLINING TRADES IN A TIMELY MANNER, REPORTINGTHE CORRECT INDICATOR FOR SALES TRANSACTIONS, TICK TEST ANDSUBMISSION OF OATS DATA.







Initiated By: NASD






Other Product Type(s): UNSPECIFIED TYPE OF SECURITIES

SEC RULES 10A-1, 10B-10, 17A-3, 605, NASD RULES 2110, 3010, 3110, 6130 -RESPONDENT FIRM FAILED TO SHOW CUSTOMER POSITIONS AS LONG ORSHORT ON THE MEMORANDUM OF BROKERAGE ORDERS FOR LISTEDSECURITIES. THE FINDINGS STATED THAT THE FIRM EXECUTED SHORTSALE TRANSACTIONS AND FAILED TO REPORT THEM TO THE NASDAQMARKET CENTER WITH A SHORT SALE MODIFIER AND FAILED TO PROVIDEWRITTEN NOTIFICATION TO ITS CUSTOMERS ITS CORRECT CAPACITY INTHE TRANSACTION. THE FINDINGS ALSO STATED THAT THE FIRM MADEAVAILABLE A REPORT ON THE COVERED ORDERS IN NATIONAL MARKETSYSTEM SECURITIES THAT IT RECEIVED FOR EXECUTION FROM ANYPERSON THAT INCORRECTLY DISCLOSED THE CORRECT "MARKETCENTER EXECUTED SHARES" AND THE "EXECUTED AWAY SHARES" ANDCOULD NOT DEMONSTRATE IF THE ORDERS WERE COVERED OR NOTCOVERED. THE FINDINGS ALSO INCLUDED THAT THE FIRM FAILED TOSHOW THE CORRECT TIME OF ENTRY AND FAILED TO SHOW THE TERMSAND CONDITIONS ON THE MEMORANDUM OF BROKERAGE ORDERS. NASDFOUND THAT THE FIRM FAILED TO ESTABLISH, MAINTAIN AND/ORENFORCE ADEQUATE WRITTEN SUPERVISORY PROCEDURES REGARDINGQUALIFICATION OF PERSONNEL, LIMIT ORDER DISPLAY, LIMIT ORDERPROTECTION, "REGULAR AND RIGOROUS" REVIEW, THREE QUOTE RULE,RISKLESS PRINCIPAL TRANSACTION REPORTING, TRADE REPORTING,ACCEPTING OR DECLINING TRADES IN A TIMELY MANNER, REPORTINGTHE CORRECT INDICATOR FOR SALES TRANSACTIONS, TICK TEST ANDSUBMISSION OF OATS DATA.


Resolution:



No









Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, MAXIM GROUP LLC.,CONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS, THEREFORE, THE FIRM WAS CENSURED, FINED $18,500 ANDREQUIRED TO REVISE THE FIRM'S WRITTEN SUPERVISORY PROCEDURESREGARDING QUALIFICATION OF PERSONNEL, LIMIT ORDER DISPLAY, LIMITORDER PROTECTION, "REGULAR AND RIGOROUS" REVIEW, THREE QUOTERULE, RISKLESS PRINCIPAL TRANSACTION REPORTING, TRADEREPORTING, ACCEPTING OR DECLINING TRADES IN A TIMELY MANNER,REPORTING THE CORRECT INDICATOR FOR SALES TRANSACTIONS, TICKTEST AND SUBMISSION OF OATS DATA.


Initiated By: NASD


Other





Allegations: SEC RULES 10A-1, 10B-10, 17A-3, 605, NASD RULES 2110, 3010, 3110, 6130 -FIRM FAILED TO SHOW CUSTOMER POSITIONS AS LONG OR SHORT ONTHE ORDER TICKETS FOR LISTED SECURITIES. THE FIRM EXECUTEDSHORT SALE TRANSACTIONS AND FAILED TO REPORT THEM TO THENASDAQ MARKET CENTER WITH A SHORT SALE MODIFIER AND FAILED TOPROVIDE WRITTEN NOTIFICATION TO ITS CUSTOMERS ITS CORRECTCAPACITY IN THE TRANSACTION. THE FIRM MADE AVAILABLE A REPORTON THE COVERED ORDERS IN NMS SECURITIES THAT INCORRECTLYDISCLOSED THE CORRECT "MARKET CENTER EXECUTED SHARES" ANDTHE "EXECUTED AWAY SHARES" AND COULD NOT DEMONSTRATE IF THEORDERS WERE COVERED OR NOT COVERED. THE FIRM FAILED TO SHOWTHE CORRECT TIME OF ENTRY AND FAILED TO SHOW THE TERMS ANDCONDITIONS ON ORDER TICKETS. THE FIRM FAILED TO ESTABLISH,MAINTAIN AND/OR ENFORCE ADEQUATE WRITTEN SUPERVISORYPROCEDURES REGARDING QUALIFICATION OF PERSONNEL, LIMIT ORDERDISPLAY, LIMIT ORDER PROTECTION, "REGULAR AND RIGOROUS" REVIEW,THREE QUOTE RULE, RISKLESS PRINCIPAL TRANSACTION REPORTING,TRADE REPORTING, ACCEPTING OR DECLINING TRADES IN A TIMELYMANNER, REPORTING THE CORRECT INDICATOR FOR SALESTRANSACTIONS, TICK TEST AND SUBMISSION OF OATS DATA.








Other


AWC; FINE; CENSURE; UNDERTAKING


Resolution:

Other Sanctions Ordered: UNDERTAKING TO REVISE THE SUPERVISORY PROCEDURES.

Sanction Details: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLCCONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS; THEREFORE, THE FIRM IS CENSURED AND FINED $18,500.00



Disclosure 24 of 27

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Initiated By: NASD

Allegations: SEC RULE 10B-10, NASD RULES 2110, 3010, 6955(A) - RESPONDENT FIRMTRANSMITTED TO OATS REPORTS THAT CONTAINED INACCURATEROUTED ORDER IDS AND INCORRECTLY SUBMITTED AN ORDER ROUTEREPORT TO OATS WHEN IT SHOULD HAVE SUBMITTED A NEW ORDERREPORT. THE FINDINGS STATED THAT THE FIRM FAILED TO PROVIDEWRITTEN NOTIFICATION DISCLOSING TO ITS CUSTOMERS ITS CORRECTCAPACITY IN THE TRANSACTION AND INACCURATELY PROVIDED WRITTENNOTIFICATION DISCLOSING TO ITS CUSTOMERS THAT THE TRANSACTIONWAS EXECUTED ON AN AVERAGE PRICE. THE FINDINGS ALSO STATEDTHAT THE FIRM FAILED TO ESTABLISH, MAINTAIN AND/OR ENFORCEADEQUATE WRITTEN SUPERVISORY PROCEDURES REGARDING NASDRULE 6440, SEC RULES 605 AND 606, RISKLESS PRINCIPAL TRADING,CROSSING OF ORDERS, REGULAR AND RIGOROUS REVIEW, THREEQUOTE RULE, REPORTING OF RISKLESS PRINCIPAL TRADES, ENSURINGTRADES REPORTED ON FIRM'S BEHALF WERE ACCURATELY REPORTED,PROPERLY MARKING ORDERS AS LONG, SHORT OR SHORT EXEMPT,AFFIRMATIVE DETERMINATION, CORRECTLY REPORTING TRADES ASLONG, SHORT OR SHORT EXEMPT, PROHIBITIONS ON EXECUTING NON-EXEMPT SHORT SALES ON A DOWN TICK, TRADING OR QUOTATIONACTIVITY DURING TRADING HALTS, LOCKING AND/OR CROSSINGQUOTATIONS, ENSURING OATS DATA IS CONSISTENT WITH NMC AND/ORTRACS, REPORTING THE CORRECT ROUTED ORDER ID, CHINESE WALLSAND BOOKS AND RECORDS.







Initiated By: NASD








Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, MAXIM GROUP LLC.,CONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS, THEREFORE, THE FIRM WAS CENSURED, FINED $17,000 ANDREQUIRED TO REVISE THE FIRM'S WRITTEN SUPERVISORY PROCEDURESREGARDING NASD RULE 6440, SEC RULES 605 AND 606, RISKLESSPRINCIPAL TRADING, CROSSING OF ORDERS, REGULAR AND RIGOROUSREVIEW, THREE QUOTE RULE, REPORTING OF RISKLESS PRINCIPALTRADES, ENSURING TRADES REPORTED ON FIRM'S BEHALF WEREACCURATELY REPORTED, PROPERLY MARKING ORDERS AS LONG, SHORTOR SHORT EXEMPT, AFFIRMATIVE DETERMINATION, CORRECTLYREPORTING TRADES AS LONG, SHORT OR SHORT EXEMPT, PROHIBITIONSON EXECUTING NON-EXEMPT SHORT SALES ON A DOWN TICK, TRADINGOR QUOTATION ACTIVITY DURING TRADING HALTS, LOCKING AND/ORCROSSING QUOTATIONS, ENSURING OATS DATA IS CONSISTENT WITHNMC AND/OR TRACS, REPORTING THE CORRECT ROUTED ORDER ID,CHINESE WALLS AND BOOKS AND RECORDS.


No



iReporting Source:








Initiated By: NASD


Other


AWC; FINE; CENSURE; UNDERTAKING


Docket/Case Number: AWC 20050013055-01



Allegations: SEC RULE 10B-10, NASD RULES 2110, 3010, 6955(A) - FIRM TRANSMITTEDTO OATS REPORTS THAT CONTAINED INACCURATE ROUTED ORDER IDS.THE FIRM FAILED TO PROVIDE WRITTEN NOTIFICATION DISCLOSING TOITS CUSTOMERS ITS CORRECT CAPACITY IN THE TRANSACTION ANDINACCURATELY PROVIDED WRITTEN NOTIFICATION DISCLOSING TO ITSCUSTOMERS THAT THE TRANSACTION WAS EXECUTED ON AN AVERAGEPRICE. THE FINDINGS ALSO STATED THAT THE FIRM FAILED TOESTABLISH, MAINTAIN AND/OR ENFORCE ADEQUATE WRITTENSUPERVISORY PROCEDURES REGARDING NASD RULE 6440, SEC RULES605 AND 606, RISKLESS PRINCIPAL TRADING, CROSSING OF ORDERS,REGULAR AND RIGOROUS REVIEW, THREE QUOTE RULE, REPORTING OFRISKLESS PRINCIPAL TRADES, ENSURING TRADES REPORTED ON FIRM'SBEHALF WERE ACCURATELY REPORTED, PROPERLY MARKING ORDERSAS LONG, SHORT OR SHORT EXEMPT, AFFIRMATIVE DETERMINATION,CORRECTLY REPORTING TRADES AS LONG, SHORT OR SHORT EXEMPT,PROHIBITIONS ON EXECUTING NON-EXEMPT SHORT SALES ON A DOWNTICK, TRADING OR QUOTATION ACTIVITY DURING TRADING HALTS,LOCKING AND/OR CROSSING QUOTATIONS, ENSURING OATS DATA ISCONSISTENT WITH NMC AND/OR TRACS, REPORTING THE CORRECTROUTED ORDER ID, CHINESE WALLS AND BOOKS AND RECORDS.



Resolution:

Other Sanctions Ordered: UNDERTAKING TO REVISE THE SUPERVISORY PROCEDURES.










Disclosure 25 of 27

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Initiated By: NASD







Allegations: SEC RULE 15C2-11, NASD RULES 2110, 6740 - RESPONDENT MEMBERENTERED 19 QUOTATIONS IN 17 DIFFERENT SECURITIES INTO THE PINKSHEETS AND DID NOT HAVE THE DOCUMENTATION REQUIRED BY SECRULE 15C2-11. RESPONDENT ALSO FAILED TO FILE A FORM 211 WITH NASDAT LEAST 3 BUSINESS DAYS BEFORE THE FIRM'S QUOTATIONS WEREPUBLISHED OR DISPLAYED IN A QUOTATION MEDIUM.



Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, MAXIM GROUP LLC,CONSENTED TO THE DESCRIBED SANCTION AND TO THE ENTRY OFFINDINGS, THEREFORE, THE FIRM IS FINED $5,000.


No



i83©2020 FINRA. All rights reserved. Report about MAXIM GROUP LLC






Initiated By: NASD







Allegations: SEC RULE 15C2-11, NASD RULES 2110, 6740 - FIRM MEMBER ENTERED 19QUOTATIONS IN 17 DIFFERENT SECURITIES INTO THE PINK SHEETS ANDDID NOT HAVE THE DOCUMENTATION REQUIRED BY SEC RULE 15C2-11.FIRM ALSO FAILED TO FILE A FORM 211 WITH NASD AT LEAST 3 BUSINESSDAYS BEFORE THE FIRM'S QUOTATIONS WERE PUBLISHED OR DISPLAYEDIN A QUOTATION MEDIUM.



Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, MAXIM GROUP LLCCONSENTED TO THE DESCRIBED SANCTION AND TO THE ENTRY OFFINDINGS, THEREFORE, THE FIRM IS FINED $5,000.



Disclosure 26 of 27

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Allegations: SEC RULE 11AC1-4, NASD RULES 2110, 6955(A) - MAXIM GROUP LLC FAILEDTO DISPLAY IMMEDIATELY CUSTOMER LIMIT ORDERS IN NASDAQSECURITIES IN ITS PUBLIC QUOTATION WHEN EACH SUCH ORDER WAS ATA PRICE THAT WOULD HAVE IMPROVED THE FIRM'S BID OR OFFER INEACH SUCH SECURITY, OR WHEN THE ORDER WAS PRICED EQUAL TOTHE FIRM'S BID OR OFFER AND THE NATIONAL BEST BID OR OFFER FOREACH SUCH SECURITY AND THE SIZE OF THE ORDER REPRESENTEDMORE THAN A DE MINIMIS CHANGE IN RELATION TO THE SIZE ASSOCIATEDWITH THE FIRM'S BID OR OFFER IN EACH SECURITY; THE FIRM FAILED TOREPORT TO THE ORDER AUDIT TRAIL SYSTEM (OATS) EXECUTIONREPORTS FOR REPORTABLE ORDER EVENTS (ROES); AND THE FIRMFAILED TO REPORT TO OATS THE PROTECTED CUSTOMER LIMIT PRICEFOR ROES.







Initiated By: NASD







SEC RULE 11AC1-4, NASD RULES 2110, 6955(A) - MAXIM GROUP LLC FAILEDTO DISPLAY IMMEDIATELY CUSTOMER LIMIT ORDERS IN NASDAQSECURITIES IN ITS PUBLIC QUOTATION WHEN EACH SUCH ORDER WAS ATA PRICE THAT WOULD HAVE IMPROVED THE FIRM'S BID OR OFFER INEACH SUCH SECURITY, OR WHEN THE ORDER WAS PRICED EQUAL TOTHE FIRM'S BID OR OFFER AND THE NATIONAL BEST BID OR OFFER FOREACH SUCH SECURITY AND THE SIZE OF THE ORDER REPRESENTEDMORE THAN A DE MINIMIS CHANGE IN RELATION TO THE SIZE ASSOCIATEDWITH THE FIRM'S BID OR OFFER IN EACH SECURITY; THE FIRM FAILED TOREPORT TO THE ORDER AUDIT TRAIL SYSTEM (OATS) EXECUTIONREPORTS FOR REPORTABLE ORDER EVENTS (ROES); AND THE FIRMFAILED TO REPORT TO OATS THE PROTECTED CUSTOMER LIMIT PRICEFOR ROES.


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLCCONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS; THEREFORE, THE FIRM IS CENSURED AND FINED $10,000.


No




Allegations: VIOLATION OF SEC RULE 11AC1-4, NASD RULES 2110, 6955(A) - FAILURE TODISPLAY IMMEDIATELY CUSTOMER LIMIT ORDERS IN NASDAQ SECURITIESIN PUBLIC QUOTATION WHEN EACH SUCH ORDER WAS AT A PRICE THATWOULD HAVE IMPROVED THE FIRM'S BID OR OFFER IN EACH SUCHSECURITY, OR WHEN THE ORDER WAS PRICED EQUAL TO THE FIRM'S BIDOR OFFER AND THE NATIONAL BEST BID OR OFFER FOR EACH SUCHSECURITY AND THE SIZE OF THE ORDER REPRESENTED MORE THAN A DEMINIMIS CHANGE IN RELATION TO THE SIZE ASSOCIATED WITH THE FIRM'SBID OR OFFER IN EACH SECURITY; FAILURE TO REPORT TO THE ORDERAUDIT TRAIL SYSTEM (OATS) EXECUTION REPORTS FOR REPORTABLEORDER EVENTS (ROES); FAILURE TO REPORT TO OATS THE PROTECTEDCUSTOMER LIMIT PRICE FOR ROES.








Initiated By: NASD







VIOLATION OF SEC RULE 11AC1-4, NASD RULES 2110, 6955(A) - FAILURE TODISPLAY IMMEDIATELY CUSTOMER LIMIT ORDERS IN NASDAQ SECURITIESIN PUBLIC QUOTATION WHEN EACH SUCH ORDER WAS AT A PRICE THATWOULD HAVE IMPROVED THE FIRM'S BID OR OFFER IN EACH SUCHSECURITY, OR WHEN THE ORDER WAS PRICED EQUAL TO THE FIRM'S BIDOR OFFER AND THE NATIONAL BEST BID OR OFFER FOR EACH SUCHSECURITY AND THE SIZE OF THE ORDER REPRESENTED MORE THAN A DEMINIMIS CHANGE IN RELATION TO THE SIZE ASSOCIATED WITH THE FIRM'SBID OR OFFER IN EACH SECURITY; FAILURE TO REPORT TO THE ORDERAUDIT TRAIL SYSTEM (OATS) EXECUTION REPORTS FOR REPORTABLEORDER EVENTS (ROES); FAILURE TO REPORT TO OATS THE PROTECTEDCUSTOMER LIMIT PRICE FOR ROES.


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLCCONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS; THEREFORE, THE FIRM IS CENSURED AND FINED $10,000.



Disclosure 27 of 27

i


Initiated By: NASD


Docket/Case Number: CLI040006

Allegations: SEC RULE 10B-10 - RESPONDENT MEMBER, ON OCCASIONS WHEN ITACTED AS PRINCIPAL FOR ITS OWN ACCOUNT, FAILED TO PROVIDEWRITTEN NOTIFICATION DISCLOSING TO ITS CUSTOMERS THAT IT WAS AMARKET MAKER IN EACH SUCH SECURITY.











Other Product Type(s): UNKNOWN TYPE OF SECURITIES


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP, LLCCONSENTED TO THE DESCRIBED SANCTION AND TO THE ENTRY OFFINDINGS, THEREFORE, IT WAS FINED $2,500.


No




Initiated By: NASD


Other


FINE - $2500.00





Allegations: VIOLATION OF SECURITIES EXCHANGE ACT RULE 10B-10 - FAILURE TOIDENTIFY STATUS OF MARKET MAKER ON CONFIRMATION.








FINE - $2500.00


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, MAXIM GROUP LLCCONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS; THEREFORE, THE FIRM IS FINED $2,500.00








Arbitration Award - Award / Judgment

Brokerage firms are not required to report arbitration claims filed against them by customers; however, BrokerCheckprovides summary information regarding FINRA arbitration awards involving securities and commodities disputesbetween public customers and registered securities firms in this section of the report. The full text of arbitration awards issued by FINRA is available at www.finra.org/awardsonline.

Disclosure 1 of 1


Type of Event: ARBITRATION

Arbitration Forum:

Case Initiated:

Case Number:

Allegations:

Disputed Product Type:

Sum of All Relief Requested:

Disposition:

Disposition Date:

Sum of All Relief Awarded:

FINRA

12/31/2015

15-03492

ACCOUNT ACTIVITY-CHURNING; ACCOUNT ACTIVITY-FRAUD; ACCOUNTACTIVITY-SUITABILITY; ACCOUNT ACTIVITY-UNAUTHORIZED TRADING

COMMON STOCK; MUTUAL FUNDS; OTHER TYPES OF SECURITIES; UNITINVESTMENT TRUST

$475,000.00

AWARD AGAINST PARTY

05/13/2019

$226,356.40

There may be a non-monetary award associated with this arbitration.Please select the Case Number above to view more detailed information.





www.finra.org/awardsonline

https://www.finra.org/arbitration-mediation/arbitration-awards-online?search=15-03492


End of Report

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