SEC Charges Brokerage Firm for Failure to File Suspicious Activity Reports
March 29, 2019
File No. 3-19125
March 29, 2019 - The Securities and Exchange Commission today announced settled charges against Vision Financial Markets LLC, a clearing broker, for failing to report suspicious sales of hundreds of millions of penny stock shares.
Broker-dealers are required to file Suspicious Activity Reports (SARs) for transactions suspected to involve fraud or with no apparent lawful purpose. According to the SEC's order, from August 2013 through December 2014, Vision cleared for sale a significant amount of suspicious penny stock transactions for customers of its introducing brokers. The SEC's order finds that in more than 250 instances of suspicious trading patterns, involving at least 101 customer accounts, customers deposited sizeable blocks of penny stock, systematically sold the shares into the market shortly thereafter, and wired out the proceeds. These transactions involved approximately 500 million shares and over $50 million in sales proceeds. According to the order, Vision failed to file SARs with respect to these suspicious transactions.
Without admitting or denying the SEC's findings, Vision agreed to a settlement that imposes a $625,000 penalty, a censure, and an order to cease and desist from similar violations in the future.
The SEC's investigation was conducted by Joshua Geller, Jonathan Grant, Dmitry Malinskiy, Michael Paley and Wendy Tepperman of the New York Regional Office. The case was supervised by Sanjay Wadhwa. The SEC's examination that led to the enforcement action in this matter was conducted by Rhonda Wilson, MaryKate Kelley, Michael Lally, and Andrew Caverly, and supervised by Kevin Kelcourse of the Boston Regional Office.