NOTE: Stipulations of Fact and Consent to Penalty (SFC); Offers of Settlement (OS); and Letters of Acceptance Waiver, and Consent (AWC) are entered into by Respondents without admitting or denying the allegations, but consent is given to the described sanctions & to the entry of findings. Additionally, for AWCs, if FINRA has reason to believe a violation has occurred and the member or associated person does not dispute the violation, FINRA may prepare and request that the member or associated person execute a letter accepting a finding of violation, consenting to the imposition of sanctions, and agreeing to waive such member's or associated person's right to a hearing before a hearing panel, and any right of appeal to the National Adjudicatory Council, the SEC, and the courts, or to otherwise challenge the validity of the letter, if the letter is accepted. The letter shall describe the act or practice engaged in or omitted, the rule, regulation, or statutory provision violated, and the sanction or sanctions to be imposed.

UVEST Financial Services Group, Inc.
AWC/2008012048601

The Firm allowed registered representatives to operate registered investment advisory (RIA) programs not affiliated with the firm. These RIA programs were operated by firm registered representatives who were dually registered as representatives and RIAs. The RIA programs maintained accounts away from the firm and had assets under management of over $350 million. The dually registered representatives who operated these RIA programs participated in the execution of securities transactions, through broker-dealers other than the firm, involving mostly equity investments. Because the firm viewed these RIA programs as outside business activities, the firm did not comply with its obligations under NASD Rule 3040 with regard to the RIA programs, including complying with supervisory obligations and the obligation to record the transactions on the firm’s books and records. The firm failed to record the transactions executed away from the firm in its books and records as required by NASD Rule 3040; failed to supervise registered representative/investment adviser (RR/IA)s’ participation in the securities transactions executed through brokerdealers other than the firm; and failed to establish, maintain and enforce a supervisory system to supervise the RR/IA activities reasonably designed to provide an understanding of the nature of the services provided by its RR/IAs, the scope of each RR/IA’s authority, and the suitability of the transactions in which the RR/IA participated. In addition, the firm did not have WSPs to specifically address supervision of the securities activities of outside RIAs until a later date.

UVEST Financial Services Group, Inc. : Censured; Fined $75,000

Tags: RIA