Massachusetts fines broker $225,000 over UIT trades

Massachusetts fines broker $225,000 over UIT trades
Improper trading practices resulted in losses for investors, says regulator.
SEP 05, 2019
The Massachusetts Securities Division has fined StockCross Financial Services and broker Peter Cunningham $225,000 over trading practices involving unit investment trusts. [More: Galvin to propose fiduciary rule for Massachusetts brokers] According to a consent order, Mr. Cunningham has been engaged in short-term trading of UITs since 2012, continuing the practice despite being placed on heightened supervision by StockCross in 2017. Short-term trading involves the sale of UITs before the date of maturity, often using the proceeds of the sale to purchase other UITs. This practice prevents the investor from collecting the full proceeds of the investment, were it to reach maturity, while increasing the commissions received by the broker, according to a release from Massachusetts securities regulator William F. Galvin. [Recommended video:​ Regulators' gloves are coming off with cybersecurity. Put up your dukes with these tips] In addition to the fine, StockCross will be required to offer restitution to the Massachusetts investors identified in the consent order. Mr. Cunningham has agreed to attend securities industry education courses.

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