Yet another broker-dealer that sold Reg D deals issued by Provident Royalties LLC has closed shop.
United Equity Securities LLC filed with the
Financial Industry Regulatory Authority Inc. on Aug. 12 to terminate its status as a broker-dealer.
The Houston-based company withdrew as a broker-dealer because it is being acquired by another firm, said William Brown Park, United Equity's CEO. “I got an offer that I couldn't refuse,” Mr. Park said. “We don't need a license when a firm is acquiring the agents and the book of business.”
Mr. Park declined to comment on when the firm will announce the acquisition or who the buyer is.
United Equity is one of a number of broker-dealers that sold Provident private-placement deals. The Securities and Exchange Commission last summer charged Provident with civil fraud, saying its private-placement offerings were part of a $485 million Ponzi scheme based on allegedly phony oil and gas investments.
Between June 2006 and January 2009, dozens of independent broker-dealers sold the Provident investments to some 7,700 investors. (To see a list of broker-dealers that sold these investments, plus commissions collected,
click here.)
Although United Equity was a seller of Provident Royalties private placements, there were no customer complaints regarding the sales, Mr. Park said. “We sold less [of Provident] than many single agents,” he said. “We did not close down because of Provident.”
According to court documents, United Equity generated $660,000 selling Provident private placements between June 2006 and January 2009. All told, the firm paid its brokers $173,200 in commissions on the sales, the documents show.
Mr. Park disputed the numbers in the court documents, however, saying United Equity Brokers only receieved $46,200 in commissions on Provident placements during that period.
United Equity Securities had 60 brokers and $100 million in assets. The firm cleared through GWM Group Inc.
To see a list of B-Ds that have shuttered this year, click here.
