The Commonwealth of Pennsylvania has fined a Florida broker-dealer a state-record $499,000 for violations within its derivative securities business.
The state's Department of Banking and Securities announced last week that it is fining Boca Raton, Fla.-based Newbridge Securities for failing to maintain controls around the sale of derivative securities by a Pennsylvania agent between 2012 and 2016.
While the state’s complaint did not name the agent involved, FINRA lists Newbridge’s Pennsylvania agent as Austin Dutton.
While the state did not provide details on the specific investments or selling practices in question, Dutton, who runs a Philadelphia-area office of Bridge Valley Financial Services, sold securities issued by American Realty Capital Partners and other firms backed or led by Nicholas Schorsch.
Schorsch’s investment empire began to crumble in 2015, when officers in American Capital Realty Partners admitted to misreporting company profits to investors and the SEC.
According to a report in the Philadelphia Inquirer, many of Dutton’s customers were Philadelphia police, firefighters and their families.