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SEC Obtains Judgment against Non-U.S. Broker-Dealer Offering Day Trading Accounts

In the United States District Court for the Southern District of New York, the SEC obtained a final judgment against a UK-based financial services firm for providing clearing services and margin to billions of dollars of U.S. securities transactions to U.S. day traders without registering as a broker-dealer.

In a complaint filed in 2020, the SEC alleged that the UK firm (i) offered clearance and settlement services, (ii) collected fees on trading activity, (iii) provided margin, (iv) acted as a custodian of funds and securities and (v) solicited new business from the public. As a result, the firm was found to have violated the broker-dealer registration provisions under SEA Section 15(a).

The court entered final judgment against the firm (i) enjoining the firm and its CEO from violations, (ii) ordering civil penalty in the aggregate of $1.1 million and (iii) barring the firm and its CEO from associating with any SEC registrant.

Primary Sources

  1. SEC Obtains Final Judgments Against Unregistered Uk Financial Firm and Its Founder for Clearing Billions of Dollars in U.S. Securities Transactions
  2. SEC Complaint Filed in United States District Court for the Southern District of New York
  3. SEC Order - John William Gunn
  4. SEC Order - Global Investment Strategy UK Ltd

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Tags

Regulated Activities
Cross-Border Registration Requirement
Regulated Entities
Broker-Dealers
Regulated Products
Securities
Body of Law
Securities Law
Jurisdiction
US - Federal
Organization
SEC Courts
Sub-Author
US District Courts