Introducing Broker Censured for Net Capital Violations
A broker-dealer and its principal agreed to settle charges with the SEC that it continued to trade even though it did not maintain sufficient net capital. The BD was registered as an introducing broker, which requires net capital of the greater of $5000 or 6 2/3 percent of aggregate indebtedness. The SEC charges that the BD included a non-allowable asset (e.g. a receivable from an affiliate) for net capital purposes yet continued to trade even after warnings from FINRA and the SEC.