South Florida Arbitration & Litigation Lawyer Blog
FINRA Fraud and Mismanagement Attorney, Russell L. Forkey, Esq.
May, 2011
Christian Genitrini (CRD #3277581, Registered Representative, New York, New York, formerly licensed with MML Investors Services, Inc.) submitted a Letter of Acceptance, Waiver and Consent in which he was fined $15,000, suspended from association with any FINRA member in any capacity for two years, and required to requalify by exam for Series 7 and Series 63 before becoming re-associated with a member firm after the expiration of the suspension term. The fine shall be paid in installments beginning 90 days after Genitrini’s reassociation with a FINRA member firm following his suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. Without admitting or denying the findings, Genitrini consented to the described sanctions and to the entry of findings that he advertised guaranteed returns on investments of up to 20 percent per year on a website belonging to a company he wholly owned; Genitrini claimed that his company was a fullservice investment firm and would, among other claims, provide high-yield investment opportunities. The findings stated that the website declared that the company invested nationwide and all industries were considered, but did not disclose the nature of the investment product or the risks of investment. The findings also stated that Genitrini’s ads appeared on other websites guaranteeing returns, and his company’s contemplated private placement documents provided no assurance that by following its current investment strategy, it would be successful or profitable; the subscription agreement also stated that the investments the company carried might be volatile and present operational risks. The findings also included that Genitrini’s Internet ads constituted communications with the public; were not based on principles of fair dealing and good faith; were not fair and balanced; did not disclose risks associated with the investment; guaranteed promising returns that were exaggerated, unwarranted or misleading; and the predictions of performance were also exaggerated or unwarranted. FINRA found that Genitrini’s private offering of securities, which involved promissory notes his company issued according to the private placement memorandum, was not made pursuant to an effective registration statement filed with the SEC; the offering was intended to be made pursuant to the exemption from registration in Section 4(2) of Rule 506 of Regulation D of the Securities Act of 1933, which prohibits offers or sales of securities by any form of general solicitation or general advertising. FINRA also found that Genitrini’s use of the Internet and his company’s website violated Section 5 of the Securities Act of 1933, and guaranteeing returns in the offer of securities over the Internet violated Section 17(a)(1) of the Securities Act of 1933. In addition, FINRA determined that Genitrini falsely described his work with his company on his member firm’s outside business activity disclosure form and also failed to disclose that he maintained a website for the company; Genitrini told his firm, in writing, that his business and website were for tax-planning services. The suspension is in effect from April 4, 2011, through April 3, 2013. (FINRA Case #2010022859701)
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