Friday, June 5, 2015

Financial Regulatory Recap: Fry's Electronics' Bank Fails FDIC Inspection & SEC Freezes $2M In Assets



The June 2015 List of Banks Examined for CRA Compliance was published. As usual, most banks passed, however, there were two that received a "needs to improve" including: Sewickley Savings Bank or Sewickley, PA, and First State Bank of Socorro, NM. Only one bank, First Electronic Bank of Sandy, UT, received a non-compliance rating. First Electronic Bank is a wholly owned subsidiary of Fry's Electronics. This is the first time I've seen this low rating given out. 

The SEC froze $2 million in assets of two brokerage accounts connected to trading schemes. The schemes were set up to manipulate Avon and other stocks.  
Only three weeks after the manipulation of Avon stock occurred, this emergency court order keeps not only the alleged illicit profits from being transferred offshore, but preserves the SEC’s ability to recover substantial penalties. -Andrew Ceresney, Director of the SEC Enforcement Division
Strategic Capital Partners Muster Ltd., Strategic Wealth Investments Inc., and PTG Capital Partners LTD were also charged. According to the announcement, the stock schemes: 
followed similar patterns where the accounts had substantial holdings in a company that had been losing value and the companies’ stock values substantially increased after a false filing or press release originating from Bulgaria.
Evidently, the firms hid behind proxy serves, false filings and phony foreign entities to hide their tracks, a strategy which clearly didn't work.