McGinn, Smith & Company, Inc. is an online investment bank that provides online discount, advanced direct-ECN access, traditional managed brokerage, and investment content services. The company’s Website, IPOSyndicate.com, offers IPO data, VC news and data, real-time quotes, streaming quotes, and research content. McGinn, Smith & Company, Inc. is based in Albany, New York.
99 Pine Street
Albany, NY 12207
U.S. Securities and Exchange Commission Charges 10 Brokers for Roles in McGinn Smith Ponzi Scheme
Sep 23 13
The Securities and Exchange Commission announced charges against 10 former brokers at an McGinn, Smith & Company, Inc. at the center of a $125 million investment scheme for which the co-owners have received jail sentences. The SEC filed an emergency action in 2010 to halt the scheme at McGinn Smith & Co. and freeze the assets of the firm and its owners Timothy M. McGinn and David L. Smith, who were later charged criminally by the U.S. Attorney's Office for the Northern District of New York and found guilty. The SEC's Enforcement Division alleges that 10 brokers who recommended the unregistered investment products involved in the scheme made material misrepresentations and omissions to their customers. The registered representatives ignored red flags that should have led them to conduct more due diligence into the securities they were recommending to their customers. The SEC's order names 10 former McGinn Smith brokers in the administrative proceeding: Donald J. Anthony, Jr. of Loudonville, N.Y., Frank H. Chiappone of Clifton Park, NY., Richard D. Feldmann of Delmar, N.Y., William P. Gamello of Rexford, N.Y., Andrew G. Guzzetti of Saratoga Springs, N.Y., William F. Lex of Phoenixville, Pa., Thomas E. Livingston of Slingerlands, N.Y., Brian T. Mayer of Princeton, N.J., Philip S. Rabinovich of Roslyn, N.Y. and Ryan C. Rogers of East Northport, N.Y. According to the SEC's order, the scheme victimized approximately 750 investors and led to $80 million in investor losses. Guzzetti was the managing director of McGinn Smith's private client group from 2004 to 2009, and he supervised brokers who recommended the firm's offerings. The SEC's Enforcement Division alleges that despite his knowledge of serious red flags, Guzzetti failed to take any action to investigate the offerings and instead encouraged the brokers to sell the notes to McGinn Smith customers.