The Securities and Exchange Commission (SEC) announced the settlement of separate complaints related to compliance failures by Feltl & Company, Inc. (Feltl) and Omni Investment Advisors, Inc. (Omni). Omni’s former chief compliance officer, Gary R. Beynon was also named in the SEC’s complaint.
Firms are required by law to have written compliance policies and procedures in place.
The SEC alleged that from September 2008 to August 2011, Omni had no compliance procedures whatsoever. In addition, the SEC claimed its advisors were completely unsupervised. Beynon, the chief compliance officer, actually resided in Brazil. The SEC asserted that client agreements requiring the review and approval of Beynon as chief compliance officer, were signed by Beynon and backdated one day before they were produced to the SEC in response to a subpoena. Omni and Beynon agreed to settle the SEC’s charges with payment of a $50,000 penalty and Beynon’s permanent bar from acting in any compliance or supervisory capacity within the securities industry.
The SEC alleged that Feltl failed to have written compliance policies and procedures in place. In addition, the SEC claimed that Feltl advisors engaged in hundreds of principal transactions without obtaining their clients’ consent as required by law. The SEC also alleged that Feltl charged undisclosed commissions. Feltl agreed to settle the SEC’s charges with payment of a $50,000 penalty and the return more than $142,000 to its clients.