Proceeding Number 2005000879302
Amended Extended Hearing Panel Decision in Department of Enforcement v. Legacy Trading Co., LLC and Mark Uselton
March 12, 2009
Respondents violated Procedural Rule 8210 and Conduct Rule 2110 by providing false information to FINRA in connection with an investigation of the Respondent firm, and Respondent Uselton further violated such rules by refusing to answer questions at an on-the-record interview in connection with the investigation of Respondents’ short sales activities. For these violations Respondent firm is expelled and Respondent Uselton is barred from associating with any member firm in any capacity. In addition, Respondents violated: (1) Conduct Rules 3370 and 2110 and SEC Rule 203(b) by effecting short sales without first making an affirmative determination that Respondent firm could borrow or otherwise provide for delivery of the securities by the settlement date; (2) Conduct Rules 3110 and 2110 and SEC Rules 17a-3 and 17a-4 by failing to maintain certain books and records relating to their short sales and business e-mails related to the firm’s business; and (3) Conduct Rules 3010 and 2110 by failing to maintain and enforce written supervisory procedures relating to short sales and e-mail communications. For these violations Respondents are fined a total of $1,007,035.01. In addition, Respondent Uselton violated Conduct Rule 2110 by failing to update his Form U4 timely to reflect FINRA staff’s notification that it had determined to commence this disciplinary proceeding. For this violation, Respondent Uselton is fined an additional $2,500. Respondents also are ordered to pay costs.
This decision has been appealed.
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