SEC Settles with Former Alexander Capital Broker for $300K Over Alleged Churning
The SEC has obtained a final judgment against a former broker charged with making unsuitable recommendations and churning in client accounts, the regulator says.
From July 2012 to August 2014, William Gennity allegedly recommended high-cost frequent trading to four clients, without a reasonable basis to think that the strategy would yield any profits, according to a litigation release published by the SEC.
The recommendations resulted in gains for Gennity but losses for the clients, the regulator says.
The former broker also allegedly traded without client authorization and churned in their accounts, according to the litigation release.
Gennity agreed to a bar from the securities industry and to pay $127,686 in disgorgement, $14,797 in prejudgment interest and a $160,000 civil penalty, the SEC says.
He didn’t admit or deny the regulator’s findings in settling the matter, according to the litigation release.
Gennity had been associated with the New York-based broker-dealer Alexander Capital, the SEC says. Last summer, the company settled with the regulator for more than $400,000 over allegations it had failed to supervise churning in client accounts by Gennity and two other brokers, Rocco Roveccio and Laurence Torres.
Alexander Capital supervisors Philip Noto II and Barry Eisenberg also settled with the regulator in separate orders at the time.
Gennity left Alexander Capital in 2014 for First Standard Financial Company, where he stayed until November 2018, according to his BrokerCheck profile. He never registered with another firm, according to BrokerCheck.
The SEC has brought five enforcement actions related to excessive and unsuitable trading since 2017, according to the regulator.