An institutional broker-dealer, WJB Capital Group, was expelled from the securities industry for misstating its financial records and engaging in securities transactions while below its required net capital, the Financial Industry Regulatory Authority said Wednesday.
FINRA also barred WJB Capital's chief executive, Craig A. Rothfeld, from the industry and barred chief financial officer Gregory S. Maleski from acting in a principal capacity.
The case, in which the respondents consented to the sanctions without admitting or denying FINRA's findings, shows that executives who try to keep a financially defunct firm alive by misstating its resources may also destroy their own careers in the process.
FINRA found that WJB, which ceased doing business in early January 2012, began experiencing financial stress in 2009 during the credit crisis. From then through 2011, its CEO and CFO misstated its financial position on its balance sheet by, for example, converting $9.8 million in previously
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