FINRA Fraud and Mismanagement Arbitration Attorney, Russell L. Forkey, Esq.
Al Joseph Romani (CRD #5000071, Registered Principal, Apopka, Florida) submitted a Letter of Acceptance, Waiver and Consent in which he was fined $10,000, suspended from association with any FINRA member in any capacity for 45 days, required to requalify by examination before acting in a FINOP capacity with any FINRA registered broker-dealer, and agreed to continue to cooperate in any investigation or litigation in related matters. The fine must be paid either immediately upon Romani’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, Romani consented to the described sanctions and to the entry of findings that he allowed his member firm to conduct a securities business while failing to maintain its required minimum net capital. The findings stated that Romani, as the firm’s FINOP, was responsible for preparing the firm’s books and records, net capital calculations and FOCUS reports, and that for almost an entire year, he failed to account for the trading losses in the firm’s financial books and records, net capital calculations and FOCUS reports. The findings also stated that Romani also had a responsibility to notify the SEC and FINRA that the firm was not in net capital compliance, but Romani failed to do so. The findings also included that one of Romani’s responsibilities as FINOP was to accrue for operating liabilities and loss contingencies both in the firm’s financial books and records and to include them in the net capital calculation; Romani failed to accrue for operating liabilities and loss contingencies for one month, and as a result of Romani’s failure to accrue for these liabilities, the firm’s net capital deficiency was further exacerbated. FINRA found that Romani prepared incorrect FOCUS reports, net capital calculations, and other books and records that did not reflect net capital deficiencies, including excess net capital according to its FOCUS reports, the unsecured trading debit, the total amount of unaccrued liabilities and the resulting net capital deficiencies. FINRA also found that Romani was required to file an SEC Rule 17a-11 notification of all of these net capital deficiencies on the firm’s behalf but failed to make the notifications.The suspension was in effect from May 16, 2011, through June 29, 2011. (FINRA Case #2008011684004).