Excerpts from this case filing (pdf) … bold is mine:
SureTrader, through its website, marketed itself to novice day traders seeking to avoid FINRA’s Pattern Day Trader Rule.
... March 2016 through November 2019 (“Relevant Period”) ... During the Relevant Period, U.S. Customers comprised at least 50% and, at times, as high as 80% of SureTrader’s customer base. By 2018, SureTrader had nearly 75 employees and had over 40,000 customer accounts, generating millions in trading commissions and other fees assessed by the firm. During the Relevant Period, SureTrader generated over $25.27 million in commissions from more than 14,000 U.S. Customers alone. These U.S. customers lost $29.69 million trading with SureTrader.
SureTrader’s records reflect that 97% of “United States” accounts that traded had opening deposit amounts of $5,000 or less, and 43% of “United States” accounts that traded had opening deposit amounts of $1,000 or less.
SureTrader’s unaudited balance sheet for the period ending June 30, 2019, reflected total assets of $64,773,135, liabilities of $40,533,668, and total equity of $24,239,467. As of December 31, 2019, SureTrader’s assets were reported to be $33,489, yet the joint official liquidators ("JOLs") did not identify any additional cash or investments held by SureTrader. The JOLs’ First Report raises serious questions about Gentile’s handling of SureTrader’s finances in its last days, and the circumstances indicate that Gentile likely received the benefit of SureTrader’s closure.
For the foregoing reasons, the Court should enter an order imposing the remedies the SEC has requested and enter final judgments for: (a) a permanent injunction against Gentile from violating Sections 15(a) and 20(b) of the Exchange Act, which the jury found he violated; (b) disgorgement against SureTrader and Gentile, on a joint and several basis, in the amount of $13,129,809, plus prejudgment interest of $3,547,617, for a total of $16,677,426; (c) additional disgorgement against Gentile in the amount of $1,083,750, plus prejudgment interest of $502,278, for a total of $1,586,028; and a civil money penalty against Gentile in the amount of $1,887,378.
