HKC Securities (nka ACGM, Inc.) and Principal Broker 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.”

HKC Securities, Inc. nka ACGM, Inc. (CRD #29705, New York, New York) and Harold Kenneth Cohen (CRD #49888, Registered Principal, Palm Beach, Florida)

the firm was censured and fined $50,000, and Cohen was censured and fined $10,000. Without admitting or denying the findings, the firm and Cohen consented to the described sanctions and to the entry of findings that the firm’s hedge fund sales material failed to fairly present the risks and potential disadvantages of hedge fund investing, highlighting only the fund’s positive features and not providing a sound basis for evaluating the investment, included exaggerated language, failed to identify the basis for factual statements made, and contained an inadequate discussion of the performance of the funds.

FINRA's findings stated that while the firm was engaged, among other things, in marketing hedge funds, the firm’s written supervisory procedures (WSPs) provided insufficient guidance with respect to FINRA’s content standards for hedge fund advertising and did not discuss required risk disclosures specific to hedge fund investing. Cohen, as the firm’s chief compliance officer (CCO), was responsible for the establishment of such procedures. The findings also stated that the firm failed to adequately supervise its registered representatives’ use of institutional sales material.

Harold Cohen was the supervisor responsible for reviewing and approving communications with the public but did not follow the firm’s written procedures, which required post-hoc review of institutional sales material and a written notation of approval. Cohen’s review was limited, in that his review was not focused on compliance with FINRA’s content standards, such as whether the documents contained exaggerated statements, had sufficient risk disclosures, or identified the factual basis for the statements made. Cohen’s review was also limited to the summary document the firm prepared, and did not extend to the materials the firm sent that the funds themselves had prepared.

Also, FINRA's findings included that the firm did not maintain a complete file of institutional sales material used and did not notate the sales material with the name of the person who prepared the document and the date that the document was first circulated. Cohen was responsible for ensuring the firm’s compliance with these recordkeeping requirements.
(FINRA Case #2009018628401)

According to FINRA's BrokerCheck, currently Harold Cohen is employed by and registered with the following FINRA Firm(s):
WESTON FINANCIAL SERVICES LLC
1120 AVENUE OF THE AMERICAS
SUITE 4070
NEW YORK, NY 10036
CRD# 117946
Registered with this firm since: 5/31/2013

Harold Cohen was previously registered with FINRA at the following brokerage firms:

ACGM, INC.
CRD# 29705
NEW YORK, NY
04/1992 - 02/2013

GRUNTAL & CO. INCORPORATED
CRD# 372
NEW YORK, NY
01/1990 - 04/1992

MCKINLEY ALLSOPP, INC.
CRD# 13098
10/1986 - 01/1990

This ends the information obtained from FINRA’s website.

Soreide Law Group represents clients nationwide before FINRA. If you have sustained investment losses due to your stock broker/financial advisor’s recommendations, call for a free consultation with an attorney on how to potentially recover those losses: 888-760-6552.