The Financial Industry Regulatory Authority (FINRA) revealed last week that it has fined Madison Global Partners LLC $20,000 and issued a censure after finding the New York-based brokerage failed to maintain required minimum net capital and made an unapproved change to its business operations.
FINRA Fines Madison Global Partners $20,000 Over Capital Rule Breaches
According to FINRA’s Letter of Acceptance, Waiver and Consent, the firm conducted securities business on nine occasions between November 2020 and April 2023 while below the capital levels required under U.S. securities law. Net capital deficiencies ranged from around $1,000 to $33,000, FINRA said.
During the same period, Madison Global Partners took part in firm commitment offerings without first seeking approval for the material change in its business model.
Its membership agreement is said to have required a minimum net capital of $5,000 and prohibited participation in such offerings. However, the activity demanded at least $50,000 in net capital and regulatory approval, which the firm had not obtained.
The breaches were identified during a FINRA examination in 2023. After being notified, Madison Global Partners corrected the shortfall and secured approval to engage in firm commitment underwritings.
FINRA said the conduct violated Section 15(c)(3) of the Securities Exchange Act of 1934, Exchange Act Rule 15c3-1, and FINRA Rules 4110(b)(1), 1017 and 2010, which require firms to uphold high standards of commercial honour.
Madison Global Partners accepted the findings without admitting or denying them and agreed to pay the fine.
