Capital Securities Management Fined by FINRA

Capital Securities Management fined $470,000.

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In December, 2015, the Financial Industry Regulatory Authority (“FINRA”) announced that Capital Securities Management of Glen Allen, Virginia submitted an acceptance, waiver and consent letter regarding its sales of four million dollars of reverse convertible notes (RCNs) to its clients, and the firm’s failure to effectively implement a reasonable supervisory system designed to achieve compliance with the securities laws. In agreeing to the AWC, the firm was fined $470,000 and ordered to pay over two hundred thousand dollars in restitution.

FINRA’s allegations against Capital Securities Management concerned the sales of RCNs, and the over concentration of RCNs in customer accounts.  FINRA found the firm failed to establish, maintain and enforce a reasonable supervisory system to address the sale of RCNs to its customers, and to prevent over concentration.  FINRA also criticized the firm for its anti-money laundering program which failed to detect suspicious activity regarding the deposit and sale of low priced securities through the firm.

Registration and disciplinary history

In order to lawfully sell investments to the public, a firm must either be registered or exempt from registration.  Capital Securities Management is an Virginia corporation formed in 1981 and registered with FINRA, the SEC and in 52 states and territories.

According to FINRA’s CRD disclosure report, Capital Securities Management has been the subject of one customer complaints and seven regulatory investigations.

The Law Office of David Liebrader practices exclusively in the field of investment loss recovery.  For the past 23 years, we have dedicated our law practice to assisting investors who have been victims of investment fraud via fraudulent and unsuitable investment transactions.  During that time we have recovered money for over one thousand individuals, pension plans, trusts and companies.  The recoveries we have obtained via judgments, awards and settlements on behalf of our clients exceed $40,000,000.

When investors contact our firm they can expect prompt attention, and a detailed analysis of their issues.  Typical claims that we are asked to review  involve “unsuitability (where a financial advisor makes investment recommendations that are inconsistent with a customer’s investment objectives), claims for “churning” (where a broker enters into an excessive number of trades for the purpose of generating commissions), claims involving illiquid investments such as private placements (I.e., real estate investment trusts, limited partnerships, equipment leasing and oil and gas drilling programs) as well as claims for violations of state securities laws, which often provide investors remedies like attorney’s fees and interest, if they are successful on the claim.

If you suspect that you have been the victim of investment fraud, or had a financial advisor recommend unsuitable investments to you, call us today for a free, confidential consultation at (702) 380-3131.