2 Irvine Dealers, Brokerage Fined for IPO Violations
Two broker-dealers and their Irvine brokerage were fined $30,000 for allegedly violating trading rules in selling a company’s initial public offering four years ago.
Larry H. Friend, Stephen D. Weinress and their company, L.H. Friend, Weinress, Frankson & Presson Inc., did not admit the allegations against them in agreeing to the sanctions imposed by NASD Regulation Inc., the enforcement arm of the National Assn. of Securities Dealers.
The regulator also fined Weinress, who works out of the company’s Sherman Oaks office, $1,540 for allegedly selling shares in the IPO of Golden Systems Inc. that he wasn’t supposed to sell.
In its decision, NASD’s District Business Conduct Committee found that the firm failed to have in its possession certain documents concerning the restricted nature of some of Golden Systems stock it held. Friend, as the firm’s president, failed to have adequate supervisory procedures in place to prevent the violations, NASD found.
The firm and Friend have been sanctioned previously. In four separate cases in 1986, 1991 and 1992, the firm paid $3,750 in fines, NASD said, and in 1979 Friend was censured and suspended for 60 days. The regulator did not provide details about those sanctions.
L.H. Friend and its officers were among numerous brokers and firms fined, suspended or barred by NASD for violating securities laws or trading rules.
Among the others is a Tustin woman who is appealing the sanctions against her. Nancy Hoff Martin was fined $20,000 and barred from acting as a broker-dealer.
NASD’s district committee found in its decision that Martin allowed two unregistered people to use her account executive number to make trades and failed to have procedures in place to stop such people from engaging in securities activities.
From March through May 1995, while with the Newport Beach office of Texas Capital Securities Inc., Martin allowed workers who weren’t registered as brokers to make 285 trades, totaling $55 million, the NASD committee found.
From June through August 1995, while a supervisor in the Newport Beach office of Shamrock Partners Ltd., she allowed unregistered employees to make 38 trades, totaling $2.3 million, the regulator found.
Martin appealed the findings and the sanctions to NASD’s National Business Conduct Committee.
