As alleged in the First Cause of Action, Respondents committed fraud in violation of Section 10(b) of the Securities Exchange Act of 1934, SEC Rule 10b-5, and FINRA Rules 2020 and 2010. For this misconduct, each Respondent is barred from associating with any FINRA member firm in any capacity.
As alleged in the Second Cause of Action, Respondents engaged in outside business activities without giving prior written notice to the firm that employed them, in violation of NASD Rule 3030 and FINRA Rule 2010. For this misconduct, each Respondent would be fined $10,000, but, in light of the bar, this sanction is not imposed.
The Third Cause of Action alleging that Respondents violated NASD Rule 3110 and FINRA Rule 2010 by causing a books and records violation is dismissed.
This decision has been appealed.
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