Brenton Bataille, of Centennial, Colorado, a stockbroker currently registered with Spencer Edwards, Inc., has been fined and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based on consenting to findings that he made unsuitable investment recommendations to customers concerning convertible notes. Letter of Acceptance, Waiver and Consent, No. 2014041862704 (Dec. 4, 2017).
According to the AWC, an offering of convertible notes issued by DOM had been conducted through Spencer Edwards from September of 2013 to August of 2014. Evidently, DOM sought funds to create a digital signage advertising network. Evidently, the company contracted with the firm to take on a $1,000,000.00 private placement offering, where the subordinate convertible promissory notes sold to customers was exempt from Securities Act of 1933 registration under Regulation D Rule 506(b).
Apparently, Bataille conducted a review and examination of DOM prior to the DOM’s September 2013 offering. Yet, the AWC stated that minimal due diligence had been conducted, and he never investigated DOM’s representations about the signage and lease information and credentials of principals that DOM employed. Apparently, DOM’s business model rested upon its ability to lease the space in areas of high traffic, and it represented to customers that it procured signage locations in favorable areas. The AWC stated that $50,000.00 of DOM notes were subsequently sold to an accredited investor by Bataille on September 24, 2013, where Bataille was compensated $2,200.00 as a result.
FINRA found that Bataille lacked any adequate foundation to conclude that the private placement investment he recommended was suitable. The AWC stated that Bataille did not understand if DOM provided any accurate information to Bataille prior him having made the notes recommendations and effected sales of the notes. Moreover, the AWC stated that Bataille made the investment recommendations even though the firm’s due diligence was not yet completed. FINRA concluded that Bataille’s conduct was violative of FINRA Rules 2010 and 2111(a).
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