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IN THE MATTER OF: YORK STOCKBROKERS, INC. * * * * * * * * * * * * * * |
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STIPULATION AND AGREEMENT File No. ST-07-7374-S |
WHEREAS, the Banking Commissioner (the "Commissioner") is charged with the administration of Chapter 672a of the Connecticut General Statutes, the Connecticut Uniform Securities Act (the "Act") and Sections 36b-31-2 et seq. of the Regulations of Connecticut State Agencies (the "Regulations") promulgated under the Act;
WHEREAS, on November 8, 2006, York Stockbrokers, Inc. (“York”) of 610 Fifth Avenue, 6th Floor, New York, New York filed with the Securities and Business Investments Division of the Department of Banking (the “Division”) an application for registration as a broker-dealer pursuant to Sections 36b-7 and 36b-32 of the Act and disclosed in such application that it had effected securities transactions for one or more Connecticut customers at a time when York was not registered as a broker-dealer in Connecticut;
WHEREAS, York, a corporation formed on June 17, 1999, has no reported disciplinary history;
WHEREAS, the Commissioner, through the Division, conducted a follow-up investigation pursuant to Sections 36b-8 and 36b-26 of the Act into the activities of York to assess the accuracy of the information provided by York as well as the firm’s compliance with the Act and the Regulations thereunder;
WHEREAS, the Commissioner ascertained, as a result of such investigation, that from at least January, 2005 through January 2007 when its broker-dealer application was pending, York 1) transacted business as a broker-dealer absent registration in contravention of Section 36b-6(a) of the Act; and 2) at various times employed at least three unregistered broker-dealer agents in contravention of Section 36b-6(b) of the Act;
WHEREAS, as a result of such investigation, the Division alleges that York violated Sections 36b-6(a) and 36b-6(b) of the Act by transacting business as a broker-dealer absent registration and employing unregistered agents;
WHEREAS, York maintains, and has furnished the Division with documentation evidencing that, it had relied on the advice of outside compliance consultants in erroneously assuming that Connecticut law provided for a de minimis exclusion from the definition of “broker-dealer” during the period of unregistered activity;
WHEREAS, Section 4-177(c) of Chapter 54 of the Connecticut General Statutes permits the resolution of a contested case by stipulation or agreed settlement;
WHEREAS, York desires to settle the matters described herein and, without admitting or denying the allegations herein, voluntarily enters into this Stipulation and Agreement, acknowledging that this Stipulation and Agreement is in lieu of any court action or administrative proceeding adjudicating any issue of fact or law on the matters described herein;
WHEREAS, York, through its execution of this Stipulation and Agreement, voluntarily waives any rights it may have to seek judicial review or otherwise challenge or contest the terms and conditions of this Stipulation and Agreement;
NOW THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS FOLLOWS:
| 1. | York, its officers, directors, employees and representatives agree to refrain from engaging in conduct constituting or which would constitute a violation of the Act or any regulation or order under the Act, including, without limitation, transacting business as a broker-dealer absent registration and employing unregistered agents in or from this state; |
| 2. |
York shall implement revised supervisory and compliance procedures designed to improve regulatory compliance which procedures shall, at a minimum, provide for enhanced monitoring of state broker-dealer and agent licensing requirements; |
| 3. | For a two-year period, commencing on the date this Stipulation and Agreement is executed by the Commissioner, York shall submit to the Division Director a written report each calendar quarter 1) describing any securities-related complaints, actions or proceedings (including arbitrations) (such complaints, actions or proceedings referred to collectively as "Complaints") involving Connecticut residents and initiated against York or any of York's officers, agents, employees or representatives for the quarter; 2) providing information on the disposition of any such Complaints or on any Complaints reflected in an earlier report filed pursuant to this paragraph; and 3) attaching copies of such Complaints and any dispositional documents. If no securities-related Complaints exist for the quarter, the report shall so indicate. The first report shall be due no later than ten calendar days following the close of the quarter ending September 30, 2007, and the final report shall be due no later than ten calendar days following the close of the quarter ending September 30, 2009; |
| 4. | No later than the date this Stipulation and Agreement is executed by the Commissioner, York shall remit to the department by certified bank check payable to "Treasurer, State of Connecticut" the sum four thousand five hundred ($4,500) dollars, two thousand five hundred dollars ($2,500) of which shall constitute an administrative fine; six hundred dollars ($600) of which shall represent past due broker-dealer and agent registration fees; and one thousand four hundred dollars ($1,400) of which shall defray Division investigative costs; |
| 5. | Execution of this Stipulation and Agreement by the Commissioner is without prejudice to the right of the Commissioner to take enforcement action against York based upon a violation of this Stipulation and Agreement or the basis for its entry if the Commissioner determines that compliance is not being observed with the terms hereof or if any written representation made to the Commissioner by York in connection with the matters reflected herein is subsequently discovered to be untrue; and |
| 6. |
IN WITNESS WHEREOF
________/s/_________
Howard F. Pitkin
Banking Commissioner
this 6th day of June 2007.
I, Kai Tam, state on behalf of York Stockbrokers, Inc. that I have read the foregoing Stipulation and Agreement; that I know and fully understand its contents; that I am authorized to execute this Stipulation and Agreement on behalf of York Stockbrokers, Inc. and that York Stockbrokers, Inc. agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein.
York Stockbrokers, Inc.
By
________/s/_______________
Kai Tam
Director
On this 5 day of June 2007, personally appeared Kai Tam, signer of the foregoing Stipulation and Agreement, who, being duly sworn, did acknowledge to me that he was authorized to execute the same on behalf of York Stockbrokers, Inc., a corporation, and acknowledged the same to be his free act and deed, before me.
___________/s/__________________
Notary Public
My Commission Expires: Jan 21 2010