Did ViewTrade Securities, Inc. Cause You Investment Losses?
ViewTrade Securities, Inc. of Boca Raton, Florida was censured and fined $25,000 for allegedly selling returned shares to investors who did not have unfilled orders as required and failed to send confirmation to investors who purchased shares. Due to the misconduct, the firm was in violation of Rule 10b-10 of the Securities Exchange Act and FINRA Rules 5131(d)(3), 2232 and 2010.
Since 1999, ViewTrade has been a FINRA member firm and employs approximately 40 registered representatives. According to the FINRA findings, ViewTrade was the lead placement agent in connection with an initial public offering (IPO). The findings stated that after the offering was closed, the firm began contacting investors to reduce their subscription amounts because it exceeded the maximum share cap. The findings stated that due to the cancellations, 4,525 shares were returned to ViewTrade and sold to two investors who gained a profit of $30,428.75 instead of the 17 investors who had unfilled orders. In addition, ViewTrade allegedly failed to provide trade confirmations to 113 investors in the offering.
FINRA Rule 5131 governs new issue allocations and distributions. Specifically, Rule 5131(d)(3) addresses circumstances when new issue shares, trading at a premium in the secondary market, are returned to the agent or underwriter who participated in the distribution of the shares. Under that section, the member firm participating in a distribution of new issue shares is required to have an agreement in place to appropriately handle “any shares trading at a premium to the public offering price that are returned by a purchaser . . . after secondary market trading commences.” The Rule requires that when such shares are returned, the firm must use them to offset any existing syndicate short position or, if no short position exists, either (1) offer the returned shares “at the public offering price to unfilled customers’ orders pursuant to a random allocation methodology,” or (2) sell the shares on the secondary market and donate the profits to an unaffiliated charitable organization anonymously to avoid any reputational benefit to the member.
Exchange Act Rule 10b-10 and FINRA Rule 2232 require broker-dealers to “give or send” customers specified information at or before the completion of securities transactions (confirmation).
Do You Need a Boca Raton, Florida FINRA Securities Arbitration Attorney?
Are you a Boca Raton, Florida investor who has suffered significant losses in your stock brokerage and investment accounts? Did your Boca Raton, Florida stockbroker or investment advisor misrepresent facts, fail to disclose facts making the statements made false and misleading, recommend unsuitable investments or strategies, excessively trade or churn, mismanage your investment account or engage in other kinds of stockbroker misconduct? If so, you need representation by an experienced, highly-rated and nationally recognized FINRA securities arbitration attorney—a lawyer who knows FINRA rules and procedures inside and out and how to handle these FINRA arbitration cases as well as other complex legal issues.
Free Initial Consultation With Experienced FINRA Securities Arbitration Lawyers Serving Boca Raton, Florida Residents In FINRA Arbitration Proceedings
At The Law Offices of Robert Wayne Pearce, P.A. we represent investors in all kinds of securities, commodities and investment law disputes in FINRA, AAA and JAMS arbitration and mediation proceedings. Attorney Pearce and his staff represent investors throughout Florida, and across the United States on a CONTINGENCY FEE basis which means you pay nothing – NO FEES-NO COSTS – unless we put money in your pocket after receiving a settlement or FINRA arbitration award.
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For dedicated representation by Attorney Pearce with over 40 years of experience and success in all kinds of securities, commodities and investment law disputes serving Florida citizens, contact the firm by phone at 561-338-0037, toll free at 800-732-2889 or via e-mail.