Centaurus Financial: Information for Investors

Centaurus-Financial--Information-for-Investors
Centaurus Financial (CRD#: 30833) is a registered securities brokerage firm that has its primary office in Anaheim, California. The firm is licensed to operate in 53 states and territories. At the time that this article was written, there are 19 total disclosures, including 11 regulatory events and 8 FINRA arbitrations involving Centaurus Financial.

Below, our investment fraud attorneys list the six most recent disclosures involving this brokerage firm. To get full information about these disclosures, please refer to the Centaurus Financial BrokerCheck Report. All information included on this page comes directly from this report.

 

Centaurus Financial: FINRA Disclosures

 

Disclosure # 1

Date: 11/20/2016

Reporting Source: Self-Reported

Initiated By: Oklahoma Insurance Department

Allegations: “The firm provided incomplete information on a non-resident insurance renewal.”

Sanction Details: “Fine of $500. The firm was found to have provided incomplete information on a renewal application dated July 22, 2016. While the hearing examiner did not find that the firm intentionally violated any rules, it did fail to make a disclosure within the statutory time frame.”

 

Disclosure # 2

Date: 06/23/2016

Reporting Source: Regulator

Initiated By: FINRA

Allegations: “Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to identify and apply sales charge discounts to certain customers’ eligible purchases of unit investment trusts (UITs). The findings stated that specifically, the firm failed to apply sales charge discounts to eligible UIT purchases resulting in customers paying excessive sales charges.”

Sanction Details: “The firm was censured, fined $100,000, and required to pay $85,281.62 in restitution to customers.”

 

Disclosure # 3

Date: 01/28/2014

Reporting Source: Regulator

Initiated By: FINRA

Allegations: “Five of the firm’s registered representatives (wholesale representatives) functioned as wholesalers for an unaffiliated investment management firm. Although the firm contracted to provide exclusive authority and control over the direction and supervision of the representatives in connection with wholesaling five of the investment management firm’s fund private placements, the firm’s written supervisory procedures (WSPs) did not address the supervision of wholesaling activities and the firm did not supervise the wholesaling activities of the wholesale representatives. The wholesale representatives did not use their firm’s emails for their wholesaling activities and instead typically used the investment management firm’s email domain to send communications related to wholesaling the funds. However, the firm did not review or retain those emails.”

Sanction Details: “Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings, therefore the firm is censured and fined $25,000.”

 

Disclosure # 4

Date: 02/10/2011

Reporting Source: Regulator

Initiated By: Nevada

Allegations: “Respondent violated a provision of a special supervision agreement, entered into for one of its representatives, by failing to notify the division of a change in supervisors of the registered representative.”

Sanction Details: “Fine $5,000. Without admitting or denying the statement of facts and conclusions of law contained in this order, respondent consented to the entry of this order.”

 

Disclosure # 5

Date: 08/25/2010

Reporting Source: Regulator

Initiated By: FINRA

Allegations: “Failed to report the correct time of trade to the real-time transaction reporting system (RTRS) in reports of transactions in municipal securities. The firm failed to report information regarding purchase and sale transactions effected in municipal securities to the RTRS in the manner prescribed by Rule G-14 RTRS procedures and the RTRS users manual; the firm failed to report information about the transactions within 15 minutes of time of trade to an RTRS portal.”

Sanction Details: “Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings; therefore, the firm is censured, fined $10,000 and required to revise its written supervisory procedures regarding transaction reporting in municipal securities.”

 

Disclosure # 6

Date: 04/28/2009

Reporting Source: Regulator

Initiated By: FINRA

Allegations: “Respondent Centaurus Financial, Inc. failed to protect certain confidential customer records and information by using an improperly configured computer firewall and employing an ineffective username and password on its computer fax server. Centaurus’ failures permitted unauthorized persons to access stored images of faxes received by Centaurus, which included customers’ sensitive, personal and confidential data. Centaurus’ failure to adequately protect its computer fax system, also permitting an unknown individual to conduct a phishing scam. When Centaurus became aware of the phishing scam, it conducted an inadequate investigation and sent a misleading notification letter to affected customers and their brokers, telling them that only one benevolent person had obtained access to its computer fax server.”

Sanction Details: “Without admitting or denying the findings, Centaurus Financial, Inc. consented to the described sanctions and to the entry of findings; therefore, the firm is censured, fined $175,000 and required to undertake to provide corrected notifications of the unauthorized accesses to all previously notified customers and brokers within 30 days of notice of the accepted AWC; offer these customers one year of free credit monitoring; and certify to FINRA within 90 days of notice of the accepted AWC that its procedures and systems are in compliance with privacy requirements.”

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