FINRA censured and fined StockCross Financial Services of Beverly Hills $50,000 for failing to immediately publish a bid to reflect the price and size of 25 customer limit orders for over-the-counter (OTC) equity securities that were held by the firm at a price that would have improved StockCross Financial's bid or offer.
The sanction also includes a finding that StockCross Financial failed to establish and maintain an adequate supervisory system, including deficient or absent written supervisory procedures (WSPs) related to supervisory steps the firm would take to supervise brokers and/or transactions.
This is just the latest in a laundry list of disciplinary actions against StockCross Financial Services for issues related to supervision and timely transactions.
Prior to the current AWC, StockCross Financial Services drew a $30,000 fine in July 2014 for 24 OTC limit order display violations.
In 2015, FINRA fined StockCross Financial Services $800,000 for short-selling without first borrowing or delivering transacted shares for settlement in contravention of SEC Regulation SHO, which is designed to prevent firms from "naked shorting," or selling shares that they don't actually own and, in turn, failing to deliver securities to the buyer when said delivery is due. The $800,000 fine also included a citation for inadequate supervisory systems and procedures.
Also in 2015, StockCross Financial consented to another AWC—including an order of restitution—for failing to immediately execute customer market orders (CMOs) at the same price at which it traded the relevant securities products for the firm's own account, or at a better price.
The 2015 AWC found that instead of immediately executing the CMOs at this fair market price upon acceptance, StockCross Financial held the CMOs, and that this failure to timely execute CMOs at the proper price caused a discrepancy between the unit price at the time of the order and the final trade price at the time when StockCross actually executed the transactions.
StockCross Financial principal David Gebbia is the husband of former Real Housewives of Beverly Hills star Carlton Gebbia. The firm has a checkered history of arbitration claims related to reverse convertibles and structured products, in addition to the aforementioned disciplinary actions.
If you have invested with StockCross Financial of Beverly Hills, CA, or with any other firm whose failure to timely process a transaction, or failure to immediately publish an OTC bid or CMO trade has proven harmful to your investments or interests when this violative delay resulted in a poorer sale price, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.