Michael Edward Magill of Portland Maine
a stockbroker formerly registered with Foreside Fund Services LLC has been barred from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon findings that Magill effected private securities transactions. Letter of Acceptance Waiver and Consent No. 2019064830701 (Dec. 7, 2020).
According to the AWC, on December 3, 2018, during the period that Magill was associated with Foreside Fund Services, he engaged in private business activities including helping a company procure investors. Magill worked on the issuer’s behalf to find those who were willing to purchase its principal-protected notes.
Prospective investors were provided marketing materials by Magill. They received guidance from the stockbroker concerning the note terms and how the investment worked. Magill also helped investors locate the paperwork to invest.
The AWC stated that three investors acted on Magill’s advice to purchase the notes in December of 2018. The first investor who was 78 years old made a $100,000.00 purchase. The second investor purchased $500,000.00 worth of notes and the third investor contributed $100,000.00. In return for Magill’s sales efforts, he received $14,000.00 from the issuer on top of a bonus and salary. All of these transactions were arranged by Magill outside of Foreside’s auspices and without its approval.
The AWC also stated that there was no due diligence undertaken by Magill to uncover risks and features of the investments prior to recommending that investors purchase them.
By February of 2019, the federal government shut the issuer’s offices down. One of the executives of the issuer who also supervised Magill’s activities pleaded guilty to conspiracy to commit wire fraud. FINRA stated that the investors collectively lost $700,000.00 by investing in the notes recommend by Magill.
Magill was obligated by Foreside Fund Services to disclose his proposed private securities transactions and receive written approval before commencing activities. The securities broker dealer was never informed by Magill about his private transactions. He was not authorized by Foreside to be selling away. FINRA found that Magill’s conduct was violative of FINRA Rules 2010 and 3280.
Magill was registered with Foreside Fund Services between August 16, 2017 and January 24, 2019.
