SEC pushes for $240,000 fine for former co-head of equities at Cantor Fitzgerald
The Securities and Exchange Commission (SEC) has outlined the proposed penalties in its case against Adam Mattessich, former global co-head of equities at Cantor Fitzgerald.
The relevant documents, seen by FX News Group, were submitted by the regulator at the New York Southern District Court on March 28, 2022.
The SEC argues that the Court should
permanently enjoin Mattessich from future violations of Section 17(a) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 17a-3(a)(19) (the “Compensation Record Rule”); and
- impose second-tier civil penalties on Mattessich totalling $240,000.
The regulator notes that, after a five-day trial, the jury found that Defendant Adam Mattessich aided and abetted at least one violation of the Compensation Record Rule by Cantor Fitzgerald & Co, a Commission-registered broker-dealer and Mattessich’s former employer, by obtaining off-the-books commission payments in 2013 through personal checks from former co-defendant Joseph Ludovico. At trial, Mattessich refused to acknowledge his misconduct, argued that he received approval to split commissions in this manner (an argument the jury presumably rejected), and suggested his conduct was permitted and even common at Cantor (another argument the jury presumably rejected).
As a result, the SEC argues that the Court should enjoin Mattessich from future violations of the Compensation Record Rule and impose second-tier civil money penalties totaling $240,000.
The regulator says that Court should enter an injunction because Mattessich was found liable at trial and acted with a high degree of scienter—he knew Cantor was required to keep commission records, he knew Cantor’s records did not reflect his commissions, and he concealed his conduct in a number of ways.
The SEC says that the Court should enjoin Mattessich because his conduct was repeated (both during 2013 and over the prior ten years), he has never shown any recognition that his conduct was wrongful, and he continues to work in the securities industry to this day.