Commission Charges Three as Unregistered Brokers and Dealers
Purchasing and selling securities for the account of others without registering as a broker has long been held to be a violation of the Exchange Act Section 15(a). Similarly, purchasing and selling securities for your own account has long been held to be a violation of that same section – the conduct constitutes acting as a dealer. This is true even though the transactions are conducted with the person’s own capital and solely for the benefit of that person – the conduct violates the requirement that those acting as a dealer register. The point is illustrated by the Commission’s most recent case in the area, SEC v. Rondini, Civil Action No. 9-cv-81285 (S.D. Fla. Filed September 18, 2023).
Named as defendants in Rondini are: Wilson Rondini, III, Falcon Capital LLP and Falcon Capital Partners Limited. Mr. Rondini is the managing partner of Falcon LLP and indirectly owns Falcon Limited. Falcon Capital had been registered with the U.K.’s Financial Conduct Authority. It has never been registered with the Commission. Falcon Limited is a Hong Kong entity that is owned by Falcon Capital Partners Private Foundation which is registered in Curacao and is owned by Mr. Rondini. It has never been registered with the Commission.
Each Defendant effected transactions in securities for others. Each of the entity Defendants entered into agreements with over a dozen entities (“issuers”), or their underwriters, agreeing to be paid commission-based compensation in exchange for their efforts too solicit investors to purchase issuers’ securities. Following the execution of the agreements Defendant Rondini distributed mass emails to prospective investors, touting the issuers’ stock and encouraging investors to purchase it. He engaged in similar conduct in one-on-one discussions with potential investors.
Each of Defendants also purchased and sold securities for their account. These transactions were typically called “private transactions ” – dealing in securities of some of the issuers prior to any IPO. In some transactions Defendants would purchase the shares for their account and then resell them to an investor at a mark-up.
The actions of Defendants violated Exchange Act Section 15(a)(1) since none were registered with the Commission as either a broker or a dealer. Those of Defendant Rondini also violated Exchange Act Section 20(a). The case is in litigation. See Lit. Rel. No. 25831 (September 18, 2023).
Commission Charges Three as Unregistered Brokers and Dealers
Purchasing and selling securities for the account of others without registering as a broker has long been held to be a violation of the Exchange Act Section 15(a). Similarly, purchasing and selling securities for your own account has long been held to be a violation of that same section – the conduct constitutes acting as a dealer. This is true even though the transactions are conducted with the person’s own capital and solely for the benefit of that person – the conduct violates the requirement that those acting as a dealer register. The point is illustrated by the Commission’s most recent case in the area, SEC v. Rondini, Civil Action No. 9-cv-81285 (S.D. Fla. Filed September 18, 2023).
Named as defendants in Rondini are: Wilson Rondini, III, Falcon Capital LLP and Falcon Capital Partners Limited. Mr. Rondini is the managing partner of Falcon LLP and indirectly owns Falcon Limited. Falcon Capital had been registered with the U.K.’s Financial Conduct Authority. It has never been registered with the Commission. Falcon Limited is a Hong Kong entity that is owned by Falcon Capital Partners Private Foundation which is registered in Curacao and is owned by Mr. Rondini. It has never been registered with the Commission.
Each Defendant effected transactions in securities for others. Each of the entity Defendants entered into agreements with over a dozen entities (“issuers”), or their underwriters, agreeing to be paid commission-based compensation in exchange for their efforts too solicit investors to purchase issuers’ securities. Following the execution of the agreements Defendant Rondini distributed mass emails to prospective investors, touting the issuers’ stock and encouraging investors to purchase it. He engaged in similar conduct in one-on-one discussions with potential investors.
Each of Defendants also purchased and sold securities for their account. These transactions were typically called “private transactions ” – dealing in securities of some of the issuers prior to any IPO. In some transactions Defendants would purchase the shares for their account and then resell them to an investor at a mark-up.
The actions of Defendants violated Exchange Act Section 15(a)(1) since none were registered with the Commission as either a broker or a dealer. Those of Defendant Rondini also violated Exchange Act Section 20(a). The case is in litigation. See Lit. Rel. No. 25831 (September 18, 2023).