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QUANTUM FINANCIAL, LLC
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STIPULATED AGREEMENT No. ST-18-8451-S |
WHEREAS, the Banking Commissioner (the “Commissioner”) is charged with the administration of Chapter 672a of the Connecticut General Statutes, the Connecticut Uniform Securities Act (the “Act”) and Sections 36b-31-2 et seq. of the Regulations of Connecticut State Agencies promulgated under the Act (the “Regulations”);
WHEREAS, Section 36b-31-7b of the Regulations under the Act provides, in part, that:
| (a) | Each applicant for investment adviser registration shall (1) have been engaged in the securities business as a broker-dealer, agent, investment adviser or investment adviser agent spending a major portion of his or her working time in the securities business for at least three years within the seven calendar years preceding the date of the application or (2) be otherwise qualified by knowledge and experience as determined by the commissioner. | ||
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| (d) | Persons acting as managers shall meet the experience requirements of subsection (a) of this section. For purposes of this subsection, ‘manager’ means (1) any person who supervises investment adviser agents either directly or indirectly or (2) any person responsible for the day-to-day operation and supervision of an investment adviser office in this state. |
WHEREAS, as a result of such investigation, the Division believes that Quantum has not fulfilled the experience requirements set forth in Section 36b-31-7b of the Regulations;
WHEREAS, the Division also believes that a basis exists under Section 36b-15(a)(2)(J) of the Act for restricting or imposing conditions on the securities or investment advisory activities that Quantum may perform in and from this state based on Quantum's lack of securities-related experience;
WHEREAS, on May 30, 2018 Quantum amended its investment adviser application to reflect that it had retained Edward E. Romanowsky (CRD No. 3115110) as its Chief Compliance Officer. Romanowsky has no reported disciplinary history and possesses the experience described in Section 36b-31-7b of the Regulations;
WHEREAS, Quantum, through Pritchard, represents through its execution of this Stipulated Agreement Conditioning Registration as an Investment Adviser (“Stipulated Agreement”), that it has read and has familiarized itself with the Act and the Regulations thereunder, particularly those provisions governing the compliance responsibilities of investment advisers;
WHEREAS, Quantum, through its execution of this Stipulated Agreement, voluntarily waives any rights it may have to seek judicial review or otherwise challenge or contest the terms and conditions of this Stipulated Agreement;
AND WHEREAS, the issuance of this Stipulated Agreement is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of the Act;
NOW THEREFORE, THE PARTIES HERETO DO AGREE AS FOLLOWS:
| (1) |
For three years, commencing on the date this Stipulated Agreement is signed by the Commissioner, Quantum and Pritchard shall refrain from having custody or control of client funds or securities; |
| (2) | For three years from the date this Stipulated Agreement is signed by the Commissioner, Quantum and Pritchard shall not exercise discretionary trading authority with respect to client accounts nor shall they charge performance fees; |
| (3) |
For three years from the date this Stipulated Agreement is signed by the Commissioner, Quantum shall limit its investment advisory activity to securities listed on the New York Stock Exchange, the NYSE MKT, the NASDAQ Global Select Market or the NASDAQ Global Market, securities issued by investment companies regulated under the Investment Company Act of 1940, commercial paper, certificates of deposit, corporate debt securities, municipal securities, United States government securities, and insurance products subject to regulation by the Connecticut Insurance Commissioner; |
| (4) | For three years from the date this Stipulated Agreement is signed by the Commissioner, Quantum shall notify the Division Director in writing each calendar quarter of any securities-related complaints, actions or proceedings (including arbitrations and updates thereto) involving Quantum or Pritchard that occur during the quarter, including the disposition thereof. Such report shall be provided no later than ten business days following the close of the quarter. If no complaints, actions, proceedings or updates exist for the quarter, the report shall so indicate. The first report shall be due no later than ten business days following the quarter ending September 30, 2018, and the final report shall be due no later than ten business days following the quarter ending September 30, 2021; |
| (5) |
Execution of this Stipulated Agreement by the Commissioner is without prejudice to the right of the Commissioner to take enforcement action against Quantum based upon a violation of this Stipulated Agreement or the basis for its entry if the Commissioner determines that compliance is not being observed with the terms hereof or if any representation made by or on behalf of Quantum in connection with its application for registration is subsequently discovered to be untrue; |
| (6) | Nothing in this Stipulated Agreement shall be construed as limiting the Commissioner’s ability to take enforcement action against Quantum, its officers, agents or employees based upon evidence of which the Division was unaware on the date hereof relating to a violation of the Act or any regulation, rule or order under the Act[;] |
| (7) | The name of "Quantum Financial, LLC" be and is hereby entered on the Register of Investment Advisers pursuant to Section 36b-8 of the Act; and |
| (8) | This Stipulated Agreement shall become binding when executed by the parties hereto. |
IN WITNESS WHEREOF, the undersigned have executed this Stipulated Agreement on the dates indicated.
| Dated at Hartford, Connecticut, | _____/s/____________ | |
| this 22nd day of June 2018. | Jorge L. Perez | |
| Banking Commissioner |
I, John Pritchard, state on behalf of Quantum Financial, LLC, that I have read the foregoing Stipulated Agreement; that I know and fully understand its contents; that I am authorized to execute this Stipulated Agreement on behalf of Quantum Financial, LLC; and that Quantum Financial, LLC agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein.
| Quantum Financial, LLC | |
| By | ___/s/________________ |
| John Pritchard | |
| Managing Member |
_____/s/__________________________
Notary Public
My Commission Expires: May 31, 2019