Norman Gary Price of Gig Harbor Washington a stockbroker formerly associated with RP Capital LLC, Genesis Capital LLC and Aequitas Commercial Finance LLC has been fined $75,000.00 and barred by Securities and Exchange Commission (SEC) from being a stockbroker or investment adviser representative or otherwise associating with any securities broker dealer or investment adviser according to an SEC Order containing findings that Price willfully violated Investment Advisers Act by concealing information from clients regarding Aequitas investments. In the Matter of N. Gary Price Administrative Proceeding File No. 3-19267 (July 24, 2019).
According to the Order, mutual fund advisory customers of Genesis Capital LLC who purchased promissory notes investments in Aequitas Commercial Finance (ACF) were not apprised about Price’s conflicts of interest in the transactions. Genesis’ investment committee which Price served on had approved of investments enabling Price to derive a financial benefit from his relation to Aequitas. SEC indicated that in return for referring investors to Aequitas Commercial Finance and other issuers, one of the companies partially owned by Price received $8,000,000.00 in fees from an Aequitas entity that received management fees from Aequitas Commercial Finance. SEC found Price’s conduct violative of Investment Advisers Act of 1940 Section 206.
SEC also stated that Aequitas Commercial Finance and other companies under Aequitas’ umbrella had been charged by SEC with defrauding investors who bought at least $300,000,000.00 in promissory notes and other securities issued by Aequitas.
This is not the first time that Price has been the subject of sanctions by SEC based upon allegations of his misconduct in the securities industry. Price was fined $50,000.00 and ordered by SEC to cease and desist from violating federal securities laws or regulations based upon allegations that he caused Strategic Capital Group LLC’s violations of Investment Advisers Act of 1940 Section 206 and Rule 206(4)-7. In the Matter of Strategic Capital Group and N. Gary Price Administrative Proceeding File No. 3-16138.
FINRA Public Disclosure confirms that Price has been identified in twelve customer initiated investment related disputes concerning accusations of his misconduct while employed by securities broker dealers including RP Capital and Strategic Capital Group LLC. On July 21, 2016, a customer filed an investment related arbitration claim concerning Price’s activities where the customer sought $350,000.00 in damages founded on accusations of omissions and misrepresentations being made concerning private placements issued by Aequitas when Price was employed by RP Capital. FINRA Arbitration No. 16-01930.
Price is also referenced in a customer initiated investment related civil action brought in the Superior Court of the State of Washington on August 31, 2016 in which the customer requested $12,319,652.00 in damages supported by allegations that a fiduciary duty had been breached by the stockbroker when he was associated with RP Capital. According to the claim, the customer was defrauded through investing in unregistered securities including direct investments and promissory notes. Transactions were allegedly negligently supervised by RP Capital.
On August 31, 2016, another customer filed an investment related arbitration claim in reference to Price’s conduct where the customer sought $158,491.00 in damages based upon accusations that false or misleading statements were made to the customer by Price concerning promissory notes. FINRA Arbitration No. 16-01967. According to the claim, RP Capital’s policies had been violated and transactions lacked appropriate supervision from the securities broker dealer. There had allegedly been a lack of due diligence by RP Capital prior to investment recommendations being made to the customer.
Price is also referenced in a customer initiated investment related arbitration claim in which the customer requested $700,000.00 in damages based upon allegations of Price’s bad investment advice regarding Aequitas investments. FINRA Arbitration No. 16-03187 (Nov. 15, 2016). According to the claim, direct investments were not suitable for the customer. Price’s transactions allegedly lacked supervision by the securities broker dealer. The claim also alleges conflicts of interests and misrepresentations that had been made to the customer.
Price’s employment with RP Capital was terminated on June 14, 2016.