Broker-Dealer Fined for Over-Tendering

A broker-dealer settled charges brought by NYSE American ("NYSE") for over-tendering 16,300 shares in a partial tender offer and for failing to maintain an adequate supervisory system.

According to the Letter of Acceptance, Waiver and Consent, the firm tendered "without accounting for relevant short call options positions with exercise prices below the highest tender offer price or stated amount of the consideration offered for [the firm]." NYSE alleged that after applying the proration factor, 1,197 of the company's over-tendered shares were accepted and netted $20,553 of ill-gotten gains for the firm.

Without admitting or denying them, the firm consented to the findings that it failed to establish and maintain a supervisory system, violations of Exchange Act Rule 14e-4 ("Prohibited transactions in connection with partial tender offers") and NYSE American Rule 320 ("Offices—Approval, Supervision, and Control").

To settle the charges, the firm agreed to (i) a censure, (ii) a fine of $10,000, that was a portion of a larger sum of $30,000 imposed for similar violations and (iii) a disgorgement of $6,851, also part of a larger disgorgement amounting to $20,553 with added interest.