FINRA suspended former ALPS Distributors, Inc. (Denver, Colorado) broker Christopher M Hawn and fined him $10,000 for participating in unauthorized private securities transactions, an undisclosed outside business, and for distributing deficient or misleading sales materials. FINRA also cited Hawn for making false statements while associated with both ALPS and prior firm SC Distributors, LLC, of Costa Mesa, CA.
According to the findings, while associated with SC Distributors in Southern California, Hawn (CRD #4776341) participated in unapproved private securities transactions totaling nearly $99,000 by introducing investors to the offering's promoters, providing investors with marketing materials and an informational memorandum, and providing advice to an investor about the offering, all without disclosing these activities to SC Distributors.
After their review, investigators determined that the marketing materials and memorandum documents Hawn distributed to the investors were misleading and failed to disclose certain risks and provide a sound basis for evaluation, as required by industry rules. FINRA also found that the documents "failed to include clear language" regarding the investment's financial information forecasts.
Investigators additionally discovered that Hawn, while associated with ALPS Distributors, engaged in an outside business activity as a consultant for a privately owned registered investment advisor for which he signed an agreement to be paid $100-per-hour for consulting services, and failed to provide ALPS with prior written notice of any of this activity.
Hawn purportedly stated on multiple compliance questionnaires while at SC Distributors and, later, at ALPS, that all of his securities related business was done through his associated firm, and that he had disclosed all current outside business activities. FINRA found that these statements were false because he had participated in private securities transactions away from firm SC Distributors, and had engaged in unapproved and undisclosed outside business activities away from ALPS.
According to Hawn's BrokerCheck report, ALPS Distributors permitted him to resign after allegations that he engaged in an "undisclosed investment-related outside business activity."
If you have invested with Christopher M Hawn, formerly of SC Distributors (Costa Mesa, CA) and ALPS Distributors (Denver, CO), or with any broker or financial adviser whose undisclosed engagement in unauthorized private securities transactions or outside business activities away from their brokerage firm, and such business conducted outside of the scope of their FINRA-associated employment has proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.