A former longtime broker in Texas who ran a small investment fund that owned units of stuck-in-limbo GPB Capital private placements received a federal court's approval this week of a $435,000 settlement resolving charges he sold the fund despite not having a securities license at the time.
The broker, Dan Levin, who also in the past had an investment radio show in Dallas, has a history of run-ins with securities regulators and was barred from the securities industry in 2023 over the allegations of selling securities without a license.
Working as an unlicensed broker in the securities industry is a violation of industry rules.
On Tuesday, the U.S. District Court for the Northern District of Texas granted the Securities and Exchange Commission’s request for monetary remedies, $320,000 in disgorgement and penalties of $115,000 against Levin.
Levin had been suspended from the securities industry first in 2013 for six months and again in 2016, also for six months by the Financial Industry Regulatory Authority Inc. In both instances, Finra charged Levin with using the radio show, called "Investment Talk", for making unbalanced, misleading statements to clients about certain investments, including life settlement and private placements.
Levin solicited $2.6 million of client money for the fund he controlled, the CRP Fund, which in turn bought GPB Capital private placements. He solicited at least 27 investors from 2017 through 2018, without being registered with the SEC as a broker, according to the SEC.
Levin could not be reached Thursday to comment. He settled the matter last year without admitting to or denying the SEC's findings. His firm in Dallas was Comprehensive Retirement Planning, and he had been registered in the securities industry from 1980 to 2014.
The SEC alleged that "that in connection with his sale of shares in CRP Fund, Levin advised investors on the merits of investments, regularly participated in securities transactions, actively participated in all aspects of investor solicitations and sales, and received transaction-based compensation."
GPB Capital Holdings, the distressed manager of $1.7 billion of private investments, is currently in receivership, and investors who bought the securities, along with their financial advisors, are waiting to see if they will get any money back from the funds, which have been dead in the water since 2018.
"The only way to really address recidivism is through bringing criminal cases," said Kal Nekvasil, a plaintiff's attorney. "I don’t believe civil or regulatory actions do the job if a financial advisor or someone else engages in this type of conduct. And we've seen this a lot with penny stock recidivists."
"This case highlights the issues of unregistered stock promoters who frequently use radio shows and other retail marketing to sell high commission products," said Scott Silver, also a plaintiff's attorney. "The issuers are desperate to sell, and these radio show guys are hiding in plain sight."
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