Court upholds $3 million arbitration award against Spire Securities

A New York federal court has upheld a $3 million arbitration award holding Spire Securities responsible for failing to supervise one of its brokers who operated a Ponzi scheme. The broker, Patrick Evans Churchville, sold investments through ClearPath Wealth Management, a Rhode Island registered investment adviser he ran, to the 23 claimants in the arbitration case. Those claimants were a subset of the victims of Mr. Churchville's $21-million Ponzi scheme. In June, a Financial Industry Regulatory Authority Inc. arbitration panel awarded the claimants $3 million of the $21 million in compensatory damages they were seeking. [Recommended video: Personalization and custom communications are key to the evolving client experience]​ The arbitration case was the first regulatory event for Spire Securities, a subsidiary of McLean, Va.-based Spire Investment Partners. At the time of the arbitration, the firm said that none of the claimants had lost money while at Spire and that no regulator had investigated Spire over Mr. Churchville's Ponzi scheme, which occurred at an advisory firm that was separate from Spire.