Aegis Capital Admits That It Failed to File Suspicious Activity Reports
Aegis Capital Corporation admitted that it failed to file Suspicious Activity Reports (SARs) on multiple suspicious transactions. This was reported by the SEC on March 29, 2018.
When certain transactions are suspected to involve fraudulent activity or have no business or lawful purpose, broker-dealers are required to file a Suspicious Activity Report (SAR). The report filed by the SEC shows that Aegis failed to file SAR reports when red flags were raised on certain transactions. The transactions were related to market manipulation of low-priced securities.
“Aegis failed to meet its AML obligations to report suspicious activity, including when it was faced with specific information alerting the firm to suspicious transactions,” said Antonia Chion, Associate Director and head of the Broker-Dealer Task Force of the SEC’s Enforcement Division. “Given the critical importance of SARs to the regulatory and law enforcement community, brokerage firms must comply with their SAR reporting obligations.”
The order filed by the SEC found that they willfully violated the SEC financial recordkeeping and reporting rule. Aegis agreed to retain a compliance expert and to a $75,000 penalty. FINRA also announced a settlement with Aegis that includes an additional $550,000 penalty.
Former anti-money laundering (AML) compliance officer Kevin McKenna was found to have aided and abetted the violations by separate settled order. Aegis CEO Robert Eide was also found to have caused them. Eide and McKenna have agreed to pay penalties of $40,000 and $20,000 without admitting or denying the SEC’s findings.
A litigated order by the Enforcement Division also alleges that former AML compliance officer, Eugene Terracciano, failed to file SARs on behalf of Aegis. He is alleged to have aided and abetted and caused the violations. This issue will be scheduled for a public hearing before an administrative law judge.
If you or someone you know might have been a victim of Aegis, your next steps are crucial. With many years of experience, we can help you determine if you have a claim. Please contact us or call us today at 978-405-3314.