SEC Failure to Supervise, Protect

On Jun. 29, SEC charged broker with failure to protect customers.

  • Alexander Capital and 2 managers failed to supervise 3 brokers for client fraud.

Alleged Violations

  • Managers Philip Noto II, Barry Eisenberg, ignored red flags on excessive trading.
  • Noto had failied to supervise two brokers and Eisenberg failed to supervise one.
  • Did not reasonably oversee William Gennity, Rocco Roveccio or Laurence Torres.
  • Made unsuitable recommendations, churned accounts, and unauthorized trades.
  • Customers suffered loss on trades, but generated large commissions for brokers.


  • Alexander Capital to pay $193k of ill-gotten gains, $23k interest, and $193k fine.
  • Penalty will be placed in fair fund, then be returned to harmed retail customers.
  • Hire independent consultant to review implementation of policy and procedures.
  • Noto and Eisenberg given supervisory bars; Noto fined $20k, Eisenberg paid $15k.