Peter M. Rosten has agreed to pay a fine of $25,000 as a part of a settlement with the Financial Industry Regulatory Authority (FINRA).

Rosten first registered with FINRA in 1997 and has registered since then through associations with several member firms. In January 2013, he registered with FINRA through an association with The Vertical Group (CRD No. 104353) as a General Securities Representative and in other capacities. Rosten remains registered with FINRA through his association with The Vertical Group.

At all relevant times, Rosten was a trader with decades of experience and market maker at The Vertical Group, where he specialized in trading over-the-counter securities.

In December 2021, in his personal capacity, Rosten entered into a stock purchase agreement to buy up to a million shares of common stock in an issuer’s Regulation A offering at $1 per share. The issuer’s stock was historically thinly traded, and no market transactions in that stock had occurred for nearly six months prior to Rosten’s purchase agreement.

On December 6, 2021, Rosten bought a tranche of 250,000 shares and transferred them to his

personal brokerage account at another firm. Soon after, Rosten began entering not-held market orders to sell up to 100,000 shares of the stock. He routed those orders to a representative at another firm with whom he had a long professional relationship.

Throughout December and early January 2022, none of Rosten’s sell orders executed.

Starting in January 2022, while entering sell orders from his personal account, Rosten also placed limit buy orders for the stock through a firm proprietary account at The Vertical Group. Using that firm account, Rosten placed numerous limit buy orders for up to 14,000 shares at a time, at limit prices ranging from $2.50 to $3.25, at or just below the highest prices other market participants were willing to pay. Rosten’s buy orders placed through the firm account were not bona fide, and Rosten should have known that they created a false appearance of demand for the stock that artificially supported the stock’s price while he sold shares.

Rosten’s activity caused the bid-ask spread to decrease and prompted the first market transactions in the stock in over six months. From January to March 2022, Rosten entered 44 such non-bona fide limit buy orders while simultaneously selling a total of 12,110 shares from his personal account at an average price of $3.35 per share. Rosten stopped entering orders in the stock on both sides of the market when compliance personnel at The Vertical Group addressed his conduct.

Rosten’s purchases and sales of the stock resulted in a net loss.

Therefore, Rosten violated FINRA Rule 2010 by contravening Section 17(a)(3) of the Securities Act.

Rosten consented to a $25,000 fine and a four-month suspension from associating with any FINRA member in all capacities.