David Allen Walters (also known as Dave Walters) of Laguna Beach California a stockbroker formerly registered with Advisory Group Equity Services (AGES) has been fined $5,000.00 and suspended for four months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity supported by findings that Walters engaged in private securities transactions while employed by Advisory Group Equity Services. Letter of Acceptance Waiver and Consent No. 2018060587101 (Oct. 27, 2020).
According to the AWC, between October of 2017 and June of 2018, during the time that Walters was associated with Advisory Group Equity Services, he took part in four transactions outside of its auspices. The transactions involved those who invested nearly $450,000.00 in Leading Edge Power Solutions (LEPS) in exchange for Series A Preferred Units. Walters was Chairman of LEPS at the time.
The AWC stated that customers were instructed by Walters to complete subscription documents and to either make payments to him directly or to the company that he controlled. Those investors were also told by Walters that they could consult with him regarding subscriptions. FINRA also stated that at least one investor was provided with term sheets and financial projections. Walters even signed subscription agreements.
FINRA stated that Walters was not permitted under Advisory Group Equity Services’ policy to take part in any private securities transactions as they were outside the scope of his employment. Walters did not inform the securities broker dealer that he was involved in these transactions and incorrectly labeled his affairs as an outside business activity. Advisory Group Equity Services was led to believe that the company Walters chaired was financed only through his own money rather than the funds of third parties. Walters’ conduct was violative of FINRA Rules 2010 and 3280.
FINRA Public Disclosure additionally confirms that Walters is the subject of a customer initiated investment related written complaint which was settled to resolve accusations of Walters making inappropriate transactions when he was officer of Systems Evolution.
Walters was discharged by Advisory Group Equity Services founded on allegations that he raised funds for LEPS without permission. Walters was registered with NMS Capital Advisors between March 28, 2019 and September 21, 2019.