Christopher Michael Cervino (Christopher Michael Smith) a stockbroker formerly registered with Prime Capital LLC and COR Clearing LLC has been suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity supported by accusations that Cervino neglected to pay a customer $595,000.00 compensatory damages and $250,000.00 in punitive damages as provided in FINRA Arbitration No. 16-02100 in which Cervino was found liable on the customer’s claims including (1) Cervino making unsuitable investment recommendations to the customer concerning New Market Enterprises, Q Lotus and VGTel Inc. (2) Cervino negligently transacting in the customer’s account and (3) Cervino defrauding the customer. FINRA Arbitration N. 16-02100 (Sept. 21, 2018).
This is not the first time Cervino has been sanctioned by a securities regulator. In particular, Cervino has been barred from associating with any FINRA member in any capacity founded on allegations that Cervino neglected to provide certain information to FINRA which had been requested of him. Case No. 2014042949703 (July 25, 2016).
According to FINRA Public Disclosure, Cervino was initially suspended by FINRA according to a Suspension from Association letter issued to him on May 16, 2016. Evidently, Cervino was provided a total of three months from his April 20, 2016 Notice of Suspension to cooperate with FINRA or seek that his suspension be terminated. Cervino failed to cooperate by the deadline imposed, resulting in him being automatically barred by FINRA by July 25, 2016.
Thereafter, Cervino was barred from being a stockbroker or investment advisor or associating with any securities broker dealer or investment advisory according to a Securities and Exchange Commission (SEC) Order Making Findings and Imposing Remedial Sanctions Pursuant to Securities Exchange Act of 1934 Section 15(b). Case No. 3-17947 (May. 25, 2017). Evidently, SEC based its decision to bar Cervino on the fact that a jury found Cervino guilty of securities fraud, conduct violative of 15 U.S.C. §78j(b).
Apparently, a fraudulent scheme was executed by Cervino involving the manipulation of VGTel Inc. shares prices and artificial inflation of the trading volume and price of stock issued by VGTel Inc. (VGTL). Evidently, misleading and false representations steered customers towards buying VGTL shares. Cervino was sentenced to prison for defrauding investors.
Subsequently, Cervino was barred by New Jersey Bureau of Securities from being a stockbroker in the state based upon accusations that Cervino was convicted of wire fraud, conspiracy to commit wire fraud, securities fraud and conspiracy to committed wire fraud. In the Matter of Christopher Cervino Summary Bar Order (July 25, 2018). The Order noted that as much as eighty percent of VGTL stock trading volume had been attributed to Cervino, causing the share price to increase by over one hundred percent. The Bureau also referred to Cervino having falsified testimony before SEC when he was subject of the SEC enforcement action.
Cervino was terminated by Primary Capital LLC on January 7, 2016 supported by allegations that Cervino was charged with perjury, securities fraud and wire fraud.
