* * * * * * * * * * * * * * * * * *
HFP CAPITAL MARKETS LLC * * * * * * * * * * * * * * * * * * |
* * * * * * * * * * |
CONSENT ORDER DOCKET NO. CO-13-8124-S |
I. PRELIMINARY STATEMENT
II. CONSENT TO WAIVER OF PROCEDURAL RIGHTS
WHEREAS, HFP, through its execution of this Consent Order, voluntarily waives the following rights:
1. | To be afforded notice and an opportunity for a hearing within the meaning of Sections 36b-15 and 36b-27 of the Act and Section 4-177(a) of the General Statutes of Connecticut; |
2. | To present evidence and argument and to otherwise avail itself of Sections 36b-15 and 36b-27 of the Act and Section 4-177c(a) of the General Statutes of Connecticut; |
3. | To present its position in a hearing in which it is represented by counsel; |
4. | To have a written record of the hearing made and a written decision issued by a hearing officer; and |
5. | To seek judicial review or otherwise challenge or contest the validity of this Consent Order. |
III. ACKNOWLEDGEMENT OF THE COMMISSIONER'S ALLEGATIONS
WHEREAS, HFP, through its execution of this Consent Order, acknowledges the following allegations of the Commissioner, and does not admit or deny these allegations, but admits sufficient evidence exists for the Commissioner to issue an order to cease and desist, an order to make restitution, an order revoking HFP’s registration as a broker-dealer in Connecticut, and an order imposing a maximum administrative fine of one hundred thousand dollars ($100,000) per violation of the Act, or any regulation, rule or order adopted or issued under the Act:
1. | HFP violated Section 36b-31-9b of the Regulations by failing to maintain the required minimum net capital for broker-dealers, failing to give the Commissioner notice of such net capital deficiency, and failing to give the Commissioner an up-to-date statement of financial condition and such supplemental schedules and reports which were reasonably necessary to accurately reflect HFP’s total financial position; |
2. | HFP, through its former agents, in connection with the offer, sale or purchase of a security, directly or indirectly made untrue statements of material facts or omitted to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they are made, not misleading, in violation of Section 36b-4(a) of the Act; |
3. | HFP, through its former agents, engaged in dishonest or unethical practices in the securities business within the meaning of Sections 36b-31-15a(a)(20) and 36b-31-15b(a)(8) of the Regulations by using sales presentations and sales scripts in such a manner as to be deceptive or misleading. Such conduct also constitutes a violation of Section 36b-4(b) of the Act; |
4. | HFP violated Section 36b-31-14f of the Regulations by failing to provide the Division with one or more requested documents when so requested; |
5. | HFP violated Section 36b-6(b) of the Act by employing at least three agents who effected or attempted to effect securities transactions for the accounts of Connecticut investors while such agents were not registered under the Act; |
6. | HFP violated Section 36b-16 of the Act through the offer and sale of unregistered nonexempt securities in or from Connecticut to at least one investor; |
7. | HFP and its agents violated Section 36b-23 of the Act by representing to the Division that HFP’s agents updated the investment objectives on a Connecticut investor’s new account form when they had not done so; and |
8. | HFP failed to establish, enforce and maintain a system for supervising the activities of its agents that was reasonably designed to achieve compliance with applicable securities laws and regulations in violation of Section 36b-31-6f of the Regulations. |
WHEREAS, the Commissioner would have the authority to enter findings of fact and conclusions of law after granting HFP an opportunity for a hearing;
AND WHEREAS, HFP acknowledges the possible consequences of an administrative hearing and voluntarily agrees to the terms of this Consent Order as described below.
IV. CONSENT TO ENTRY OF SANCTIONS
WHEREAS, HFP, through its execution of this Consent Order, consents to the Commissioner’s entry of a Consent Order imposing the following sanctions:
1. | HFP, its representatives, agents, employees, affiliates, assigns, and successors in interest shall cease and desist from engaging in conduct constituting or which would constitute a violation of the Act or any regulation or order under the Act, either directly or through any person, organization or other device; and |
2. | No later than the date this Consent Order is entered by the Commissioner, HFP shall remit to the Department by cashier’s check, certified check or money order, made payable to “Treasurer, State of Connecticut”, the sum of $3,500, which shall constitute an administrative fine. |
V. CONSENT ORDER
NOW THEREFORE,
the Commissioner enters the following:1. | The Sanctions set forth above be and are hereby entered; |
2. | Entry of this Consent Order by the Commissioner is without prejudice to the right of the Commissioner to take enforcement action against HFP based upon a violation of this Consent Order or the matters underlying its entry, if the Commissioner determines that compliance with the terms herein is not being observed or if any representations made by HFP and reflected herein are subsequently discovered to be untrue; and |
3. | This Consent Order shall become final when entered. |
So ordered at Hartford, Connecticut, | _______/s/_________ | |
this 11th day of December 2014. | Howard F. Pitkin | |
Banking Commissioner |
CONSENT TO ENTRY OF ORDER
I, Geoffrey M. Byruch, state on behalf of HFP Capital Markets LLC that I have read the foregoing Consent Order; that I know and fully understand its contents; that I am authorized to execute this Consent Order on behalf of HFP Capital Markets LLC; that HFP Capital Markets LLC agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that HFP Capital Markets LLC consents to the entry of this Consent Order.
HFP Capital Markets LLC | |
By: | ________/s/___________ |
Geoffrey M. Byruch | |
Managing Member |
State of: Illinois
County of: Cook
On this the 31st day of October 2014, before me, Mary Hrubec, the undersigned officer, personally appeared Geoffrey M. Byruch, who acknowledged himself to be the Managing Member of HFP Capital Markets LLC, and that he, as such Managing Member, being authorized so to do, executed the foregoing instrument for the purposes therein contained by signing the name of the limited liability company by himself as Managing Member.
_____/s/_______________________ |
Notary Public |
Date Commission Expires: 3-29-15 |