SEC Charges Broker-Dealer Nationwide Planning and Two Affiliated Investment Advisers with Violating Whistleblower Protection Rule
- Written by Newsfile
September 04, 2024 4:34 PM EDT | Source: Newsfile SEC Press Digest[1]
Washington, D.C.--(Newsfile Corp. - September 4, 2024) - The Securities and Exchange Commission today announced settled charges against three affiliated registrants, Commission-registered broker-dealer Nationwide Planning Associates, Inc. and investment adviser NPA Asset Management, LLC, and state-registered investment adviser Blue Point Strategic Wealth Management, LLC, for impeding brokerage customers and advisory clients from reporting securities law violations to the SEC. The firms agreed to pay combined civil penalties of $240,000 to settle the SEC’s charges.
According to the SEC’s order, from May 2021 through February 2024, Nationwide, NPA, and Blue Point collectively asked 11 retail clients to sign confidentiality agreements in connection with payments made by the entities to the clients’ investment accounts. The payments were intended to compensate the clients for losses caused by the firms’ alleged breaches of federal or state securities laws. The order finds that the agreements contained provisions that impeded clients from reporting potential securities law violations to the SEC by permitting communications only where the SEC first initiated an inquiry. As described in the order, some of the agreements further required the clients to represent that they had not reported the underlying dispute to the SEC or to another securities regulator and would forever refrain from such reporting.
“Pure and simple, investors need to be able to report complaints or evidence of wrongdoing to the SEC without impediment,” said Corey Schuster, Co-Chief of the Enforcement Division’s Asset Management Unit. “We will continue to hold firms accountable for putting roadblocks between us and their investors.”
The SEC’s order finds that Nationwide, NPA, and Blue Point each violated Rule 21F-17(a) under the Securities Exchange Act of 1934, a whistleblower protection rule that prohibits taking any action to impede an individual from communicating directly with SEC staff about possible securities law violations. Without admitting or denying the SEC’s findings, Nationwide, NPA, and Blue Point each agreed to be censured and to cease and desist from violating the whistleblower protection rule. They further agreed to a combined penalty, which was apportioned according to their relative size and financial condition, with NPA agreeing to pay $160,000, Nationwide $70,000, and Blue Point $10,000.
The SEC’s investigation was conducted by Chantal Russell of the SEC’s Home Office and Marilyn Ampolsk of the Asset Management Unit, with assistance from Deborah Russell, and was supervised by Virginia Rosado Desilets, Mr. Schuster, and Andrew Dean of the Asset Management Unit.
SOURCE: Newsfile SEC Press Digest[2]
References
- ^ Newsfile SEC Press Digest (www.newsfilecorp.com)
- ^ Newsfile SEC Press Digest (www.newsfilecorp.com)