'Painful decision' as WJB shutters B-D operation

Wall Street outfit closes institutional brokerage; lawsuit against CEO immediately filed by investor

Jan 3, 2012 @ 1:07 pm

WJB Capital Group Inc., a Wall Street firm with more than 100 employees, is shutting its brokerage operations amid “financial issues,” according to its main attorney. The move to close the B-D immediately triggered a lawsuit against WJB.

“A decision was made -- and I might say it was a very painful decision -- that it would terminate its broker-dealer operations, and it has done so,” said Mark Skolnick, general counsel for the company at law firm Platzer, Swergold, Karlin, Levine, Goldberg & Jaslow LLP. The firm has some non-brokerage operations and is exploring “other possibilities,” he said.

WJB Capital was “unable to resolve its financial issues in a manner that would have allowed it to continue its operations under the current economic climate and the constraints that would've been placed on the corporation and its investors,” he said.

Following the announcement, the firm was sued in New York by an investor over fraud allegations.

WJB Capital and chief executive officer Craig Rothfeld were accused of fraud, breach of contract and other claims over a $250,000 investment in the company, according to a lawsuit filed Dec. 31 in New York State Supreme Court.

James McNally said that in exchange for a $250,000 investment he was promised “compensation for the duration of the investment.” WJB Capital failed to pay and used the money “for fraudulent purposes,” according to the complaint.

Rothfeld didn't return a message seeking comment.

WJB Capital, founded in 1993 with two agency brokers on the floor of the New York Stock Exchange, has offices in five cities across the U.S. and operates live trading desks for all of the nation's major equities and options exchanges, according to its website. The New York-based firm expanded from 10 employees to more than 100 in the past 10 years, the website says.

Public brokerage records on the Financial Industry Regulatory Authority's website lists nine owners and executive officers, including Chief Executive Officer Craig A. Rothfeld and founders Michael N. Romano and William J. Bonfanti.

--Bloomberg News--

0
Comments

What do you think?

View comments

Recommended for you

Sponsored financial news

Featured video

Events

Geoffrey Brown: What's top of mind at NAPFA?

NAPFA is looking ahead at the rest of 2018 and has a broad agenda that includes improving diversity in the advice industry. What's next? Geoffrey Brown offers his insights.

Latest news & opinion

10 fastest-growing IBDs

These independent broker-dealers saw the biggest percentage gains in their revenue in 2017.

The unique nature of working with celebrity clients

Athletes and entertainers are just like everyone else — aside from complex tax issues, a lack of financial savvy and a need for prenups

Top 10 IBDs ranked by revenue

These independent broker dealers generated the most revenues in 2017.

8 podcasts advisers listen to when they aren't working

Listening to podcasts for the fun of it.

UBS continues to cut loans to recruits, while increasing compensation to brokers

The wirehouse reduced recruitment loans 20% and increased bonus loans 68% in the first quarter.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print