CSI CASE AGAINST NEW YORK FIRM RESULTS IN OVER $1.2 MILLION IN FINES AND RESTITUTION

csimt 2018, Fraud, Press Release, Securities

ALEXANDER CAPITAL SALESPERSONS ENGAGED IN FRAUDULENT AND UNETHICAL PRACTICES AGAINST MONTANA CLIENTS

HELENA, Mont. – Securities Commissioner Matt Rosendale announced today that a fraud case before his office has resulted in more than $1.2 million in fines and restitution from New York brokerage firm Alexander Capital and its employees.

The Commissioner of Securities and Insurance (CSI), also known as the Montana State Auditor’s office, worked with the federal Securities and Exchange Commission (SEC) to resolve the case involving two Montanans who live in Townsend and Chester. Both Montanans were victims of fraudulent and unethical financial practices of Alexander Capital salespersons.

The CSI is a criminal justice agency that prosecutes “white collar” crimes in the insurance and securities industries.

“I’m glad we were able to favorably resolve this case for two Montanans who were taken advantage of by an out-of-state company engaging in fraudulent and unethical activity,” Rosendale said. “I would also like to thank the SEC for coming to Montana and assisting us in bringing the perpetrators to justice.”

In the case, Rosendale’s office alleged that Alexander Capital and its salespersons William Gennity, Joseph Connolly, and Ryan Murnane engaged in the unethical and fraudulent practices of unauthorized trading, excessive trading, and unsuitable trading in the brokerage accounts of a Townsend, Mont., resident and a Chester, Mont., resident.

The CSI also alleged that Alexander Capital’s officers and supervisors, Barry Eisenberg, Timothy Stack, and Rocco Guidicipietro failed to reasonably supervise Gennity, Connolly and Murnane, and failed to comply with a heightened supervision agreement involving Murnane. Alexander Capital charged the Montana residents more than $350,000 in commissions and the two investors lost more than $600,000 due to the unethical and fraudulent practices.

The CSI settled with Alexander Capital, Eisenberg, Stack, Guidicipietro and Gennity.  The CSI held a hearing regarding Connolly and Murnane.

As a result of CSI’s actions, Alexander Capital has paid the Townsend resident $50,853 and the Chester resident $45,800. Alexander Capital also paid a $100,000 fine and another almost $10,000 to a company associated with the Townsend resident.

Commissioner Rosendale has ordered Connolly to pay $200,000 in restitution to the Townsend resident and another $35,000 to the resident’s company. Murnane was ordered to pay over $300,000 in restitution to the Chester resident.

Connolly was also fined $200,000 and Murnane was fined $300,000. The two men must also reimburse Rosendale’s office nearly $11,000 for investigation costs. Gennity is no longer in the securities industry.

Documents from the Alexander Capital case are available below:

 

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