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.

Pali Capital, Inc.
AWC/2006004122301

The Firm maintained the registrations for individuals employed by or affiliated with hedge funds that were firm customers and that executed trades through the firm but who were not active in the firm’s investment banking or securities business, and did not function otherwise as registered representatives. The firm failed to establish, maintain and enforce an adequate supervisory system and adequate written supervisory procedures reasonably designed to achieve compliance with FINRA rules to prevent the firm from maintaining the registration of any registered representative who was not actively involved in the firm’s investment banking or securities business and not functioning as a firm representative. 

Pali Capital, Inc.: Censured; Fined $25,000