North Dakota Brokerage Firm Redeems $1 Million In Pawned Stock
- Created: Thursday, 26 January 2012 09:43
Capital Financial has been hit hard by the collapse of the private placement sales channel, in which it was a major player.
However, it initially sold the shares to a company called PawnMart back in 2006, well before the collapse of private placement vendors like Medical Capital and Provident Royalties, much less the 2008 credit crunch.
As a result, the easy moral conclusions aren't easy to draw here. Capital Financial didn't "pawn its own shares to cover its private placements."
And while funding conditions in the industry aren't great, this is not evidence that struggling broker-dealers "have to pawn their own stock to survive."
Remember, the firm didn't just pawn its shares recently. They bought them back at a huge premium of something like 500% over recent market price.
This Website Is For Financial Professionals Only
- Despite Its Long Rap Sheet, Merrill Lynch Is Coopting The Fiduciary Message; Thundering Herd Will Beat A Glorious Path To Restoring Investor Trust
- Commonwealth Financial Network Announces New Advisor Affiliation Models: You Can Be A Fee-Only RIA And Leverage The BD's Services
- 2012 Report Identifies Top Five Challenges For Broker-Dealers Along With Industry Trends And Best Practices
- Lincoln Financial Advisor Defamation Case Highlights The Limitations Of Brokercheck