Crucible Capital Group and Charles Moore Fined and Censured by FINRA

Soreide Law Group, a Securities Arbitration Law Firm, (888) 760-6552, obtained the following information on FINRA’s website under “Disciplinary and Other FINRA Actions, June, 2013.”

Crucible Capital Group, Inc. (CRD® #133542, New York, New York) and Charles J. Moore (CRD #4525896, Registered Principal, East Brunswick, New Jersey)

submitted an Offer of Settlement in which the firm was censured and fined $12,500, and for six months, is required to file all retail communications and institutional communications, excluding correspondence, with FINRA’s Advertising Regulation Department at least 10 business days prior to use. Moore was censured and fined $10,000. FINRA® imposed a lower fine as to the firm after it considered, among other things, the firm’s revenues and financial resources. Without admitting or denying the allegations, the firm and Moore consented to the described sanctions and to the entry of findings that Moore caused unbalanced, exaggerated and misleading statements about the firm’s business activities to be published on the firm’s website.

FINRA's findings stated that the firm’s Membership Agreement with FINRA did not provide for a waiver of the two-principal requirement; but for approximately two six-month periods, the firm failed to employ two general securities principals (GSPs) in the firm’s securities business. Moore was the firm’s only GSP and was responsible for the firm’s failure to employ two GSPs. The findings also stated that the firm, acting through Moore, failed to ensure that its financial books and records accurately reflected all of the firm’s assets, liabilities and expenses. This caused the firm’s records and net capital computations for those records to be inaccurate. These inaccuracies arose in part from problems related to an Expense Sharing Agreement (ESA) between the firm and an affiliated company Moore owned. The firm claimed that pursuant to the ESA, certain of the firm’s liabilities do not need to be recorded as liabilities on its books and records. However, under criteria set forth in FINRA Notice to Members (NTM) 03-63, the ESA was inadequate to allow the firm to avoid recognition of liabilities. Moore failed to ensure that the ESA met the criteria set forth in NTM 03-63 to permit the firm to avoid recognition of liabilities, failed to ensure that all outstanding invoices were provided to the firm’s financial and operations principal (FINOP), and thus failed to ensure that all liabilities were included in the firm’s ledgers and net capital calculations.

Also, FINRA's findings included that the firm, acting through Moore, filed inaccurate Financial and Operational Combined Uniform Single (FOCUS) Reports. In addition to the inaccurate net capital calculations, the FOCUS reports were also inaccurate because they contained inaccurate statements of intercompany receivables, pre-paid expenses and retained earnings. The firm’s inaccurate FOCUS reports arose largely as a result of its failure to record liabilities. FINRA found that the firm signed an agreement with an Internet start-up company to, among other things, assist with the start-up in raising $5 million in equity financing. Moore personally acquired a 33 percent ownership interest in the start-up and became its chief executive officer (CEO). An associated person of the firm also acquired 33 percent ownership interest in the start-up and became its president. Several registered representatives associated with the firm sent email messages to potential investors to solicit interest in the start-up, most of which copied Moore and reflected his review and input. These communications were exaggerated and misleading.
(FINRA Case #2010020949901)

This ends the information obtained on FINRA’s website.

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