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FINRA Sanctions Healthios Capital Markets Over Alleged Unregistered Investment Banking Activities

Healthios Capital MarketsPublicly available records published by the Financial Industry Regulatory Authority (FINRA) and accessed on November 29, 2018 indicate that Illinois-based brokerage firm Healthios Capital Markets, also known as Third500, has been sanctioned by FINRA in connection to alleged risk management and supervisory failures. Fitapelli Kurta is interested in hearing from investors who have complaints regarding Healthios Capital Markets (CRD# 115542).

According to a letter of Acceptance, Waiver and Consent (No. 20160482280-01) released by FINRA, Healthios Capital Markets, between January 14, 2013 and October 5, 2016, permitted four individuals to engage in investment banking activities without requiring that they pass the Series 79 examination, under which they would become registered to act as Investment Banking Representatives. FINRA’s findings state that these individuals participated in a number of investment banking activities, for instance: soliciting young companies to retain Healthios’ services; conducting research pertaining to investment banking; drawing up models and other presentations; and developing lists of possible investors. FINRA states that the firm was cognizant of these individuals’ activities, as well as their lack of qualification or registration to participate in them. FINRA found that the firm “incorrectly included” that one of them, who was registered as a General Securities Representative, already obtained Series 79 registration; the firm allegedly directed the other three to undertake the necessary examination, but did not follow up later to confirm that they had taken and passed it. FINRA states that the firm allowed them to continue in their investment banking activities for as many as three years without proper registration.

FINRA’s findings go on to state that these failures stem from the firm’s failure to establish, maintain and enforce supervisory protocols, including written supervisory procedures, that were reasonably designed to achieve compliance with applicable registration rules. FINRA states that although its existing WSPs stated that the firm would require individuals engaging in relevant activities to obtain Series 79 licensing, the protocol “was unreasonable because it failed to identify who was responsible for ensuring the proper qualification and registration of the firm’s investment banking representatives,” and also because it did not elucidate how responsible individuals would ensure that representatives obtained necessary registration and qualifications prior to participating in investment banking activities. In connection to these findings, FINRA sanctioned the firm and issued it a fine of $50,000.

If you or someone you know has a complaint regarding Healthios Capital Markets, also known as Third500, call Fitapelli Kurta at 877-238-4175 for a free consultation. You may be able to recover lost funds. Fitapelli Kurta accepts all cases on contingency: we only get paid if and when you collect money. You may have a limited window to file your complaint, so we encourage you to avoid delay. Call 877-238-4175 now to speak to an attorney for free.

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