The Monetary Trade Regulatory Authority introduced parallel settlements towards two former brokers in Yorba Linda, California over allegations that they improperly bought $eight million value of promissory notes issued by a personal fairness fund.
William N. Pugh and Josiah D. Jennings, who settled Finra’s allegations with out admitting or denying its allegations, had been every suspended for 10 months and fined $10,000, in accordance with letters of settlement issued Tuesday. They’ve each been registered as funding advisors with RIA Vela Consulting since 2019, in accordance with registration information.
From April to August 2024, whereas dually registered as brokers with funding financial institution Columbia Capital Securities, Pugh and Jennings raised the funds from 18 traders, practically all of whom had been clients at Columbia, in accordance with the settlements.
Pugh, who was a restricted associate within the fund and held a 3% possession curiosity, helped to establish and solicit potential traders and facilitated their buy of the notes and switch of funds, in accordance with his settlement.
Jennings had consulted with counsel, participated in drafting providing paperwork, chosen traders, participated in preliminary outreach conferences with these traders and executed the promissory notes on behalf of the fund, in accordance with his settlement.
Neither Pugh nor Jennings obtained any commissions from the transactions, in accordance with the settlements.
Each Pugh and Jennings had been permitted to resign from Columbia Capital in September 2024 whereas below investigation for “taking part in promoting securities [away from the firm] with out discover to or approval from agency,” in accordance with the settlements.
They violated Finra guidelines prohibiting personal securities transactions with out agency approval and its catch-all rule mandating excessive requirements of conduct, in accordance with the settlements. Finra initiated its investigations into the previous brokers following Columbia Capital’s U5 type filed with regulators.
Angela A. Turiano of Scarinci Hollenbeck in New York Metropolis, who represented Pugh and Jennings, didn’t reply to a request for remark. Neither advisor responded to requests for remark despatched via social media.
Pugh first registered as a dealer with Charles Schwab & Co. in 2004 however dropped his brokerage license in 2014 when he joined Apreim Advisors, in accordance with registration information. Jennings began with Larson Monetary Group in 2012 and labored at LPL Monetary earlier than becoming a member of Vela Consulting.
Pugh lists himself as a strategic advisor at Oak Quarry Administration, and Jennings is a fund supervisor on the funding administration firm, in accordance with their LinkedIn profiles.
Vela Consulting, which lists Jennings as a supervisor, oversees $47 million in discretionary belongings, in accordance with its Type ADV.