Firm Settles FINRA Charges For Violating Private Placement Content Standards

A firm settled FINRA charges for violations of content standards in private offerings sold by the firm and sent to potential investors.

In a Letter of Acceptance, Waiver and Consent, FINRA said the firm distributed communications related to private placement offerings that violated FINRA Rule 2210 ("Communications with the Public"). The communications contained projections of performance that failed to "provide a sound basis" for evaluating the facts regarding the securities products or services. Further, FINRA said the firm misrepresented these offerings by:

• failing to specify one offering was "speculative, illiquid, and could result in a total loss of the investment";
• failing to disclose material differences between two private placements and less risky investments;