Andrew Rosenberg has submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Financial Industry Regulatory Authority after he was accused of violations to the FINRA rules for brokers. Mr. Rosenberg was accused of violating NASD rule 2110 and 3030 which resulted in a $10,000 fine a three month suspension from associating with any other FINRA member.
Mr. Rosenberg established a law practice while he was employed as a broker at NFP Securities, Inc. which allegedly provided legal services to a securities issuer. At the time, he had informed NFP that he had an outside law practice by filling the required Outside Business Activities form (OBA), but he allegedly stated that there were no current conflicts of interest, but when he allegedly begun working for compensation for the issuer of the securities, he failed to submit an amended OBA reflecting the conflict.
According to the AWC, Mr. Rosenberg proceeded to sell the securities which he was legally representing to his clients, as well as to some NFP clients. The sale totaled approximately $4.5 million, and as a result Mr. Rosenberg allegedly profited from the commission of the sales, as well as from being the legal representative for the issuer. The issue was that he would allegedly withhold the fact that he was acting as the legal advisor to the issuer when he was selling the security, thus according to the AWC he was “negligently failing to disclose a material fact to the investors”. This constituted a violation of NASD 2110 which stipulates that “A member, in the conduct of its business, shall observe high standards of commercial honor and just and equitable principles of trade”. By allegedly failing to amend his OBA, Mr. Rosenberg violated NASD rule 3030, which states that “No person associated with a member in any registered capacity shall be employed by, or accept compensation from, any other person as a result of any business activity, other than a passive investment, outside the scope of his relationship with his employer firm, unless he has provided prompt written notice to the member”.
If you were a client of Mr. Rosenberg, please contact one of our attorneys to explore your possible legal options. Sonn & Erez is a nationally recognized securities law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies. For more information, you may call toll free 1-844-689-5754 or 954-763-4700.