In Overseas Bid, Cruttenden Roth Takes Over Broker

Moving to expand its scope into overseas markets, Newport Beach-based Cruttenden Roth Inc. said Thursday that it has absorbed the business and staff of South Coast Financial Securities Inc., an Irvine-based broker specializing in trades in foreign securities markets.

South Coast has about $200 million in assets managed by 10 traders, including brokerage co-founder Robert Witt and managing director Kimberly Hardaker, said Byron Roth, Cruttenden Roth’s chairman and chief executive.

Witt started South Coast Financial Securities in 1992.

In 1994 and 1996 the company signed consent orders with regulators in four states after being accused of conducting unlicensed brokerage activities there.

Witt said Thursday that the charges were filed after the firm processed unsolicited orders from investors in New Mexico, Wisconsin, Vermont and New Jersey.

“We had applied for licenses in all those states and had not heard from [regulators] in more than a month,” Witt said, “so we thought that our licenses had been approved.”

Officials at the National Assn. of Securities Dealers, which tracks actions against brokerages, said they could find no other marks on the company’s records or the records of its two principals.

Witt, in fact, is a former chairman of NASD’s District 11 and has served on the arbitration committees of both the NASD and the New York Stock Exchange. He also was a member of the Board of Governors of the Boston Stock Exchange.

Before starting South Coast, he was president and chief executive of American Capital Marketing, a major asset management firm with more than $15 billion in mutual funds. Previously, he was executive vice president and director of E.F. Hutton Group Inc.

Cruttenden Roth, which now has almost 200 employees and offices in California, Washington and Minnesota, is an investment bank and brokerage specializing in emerging growth companies.