Bulletin # 3129 - Week Ending February 9, 2024

This bulletin constitutes the only official notification you will receive from this office concerning any of the following applications.  Any observations you may have are solicited.  Any comments should be in writing to Jorge L. Perez, Banking Commissioner, Department of Banking, 260 Constitution Plaza, Hartford, CT 06103-1800.  Written comments will be considered only if they are received within ten business days from the date of this bulletin.

CREDIT UNION ACTIVITY 

Branch Activity

DATE: February 5, 2024
CREDIT UNION: Mutual Security Credit Union, Shelton
LOCATION: 6580 Main Street, Ryders Landing Lane, Stratford, CT 06614
ACTIVITY-BRANCH TYPE: Branch Closing
PROPOSED CLOSING DATE: March 31, 2024

SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY 

GlennCap LLC (IARD No. 290351) and Jonathan Vincent Glenn (CRD No. 2272521)

On February 6, 2024, the Banking Commissioner entered a Consent Order (No. CO-24-202250-S) with respect to GlennCap LLC d/b/a Glenn Capital LLC, a Connecticut registered investment adviser located at 165 West Putnam Road, Greenwich, Connecticut. Also named was Jonathan Vincent Glenn, sole member of the firm.

The Consent Order alleged that the Respondents violated the antifraud provisions in Section 36b-5 of the Connecticut Uniform Securities from January 2020 to March 2022. Specifically, Glenn, on behalf of and as an agent of Glenn Capital, engaged in “cherry picking” which is the practice of allocating favorable trades specifically to certain accounts, often to the benefit of the investment adviser, while allocating the less favorable trades to clients.  Respondent received $2,743,616 in ill gotten gains from the cherry picking and the resulting increase in performance fees attributable to accounts in which gains were assigned more favorably. The Respondents were also the subject of a Securities and Exchange Commission order requiring them to disgorge $2,743,616 in ill-gotten gains to investors; and barring them from securities-related activity.

The Consent Order directed Respondents to cease and desist from regulatory violations, revoked the firm’s Connecticut investment adviser registration; and permanently barred the firm from transacting business in Connecticut as a broker-dealer, investment adviser or any other entity requiring a license or registration from the Commissioner. The Consent Order also revoked Jonathan Vincent Glenn’s investment adviser agent registration and barred him for seven years from transacting business in Connecticut as a broker-dealer, agent, investment adviser or any other capacity requiring a license or registration from the Commissioner.

Based on the contents of the financial affidavit submitted by the Respondents which showed that they did not have the ability to pay the $100,000 fine that otherwise would have been imposed against them pursuant to Section 36b-27 of the Act, the Commissioner temporarily stayed such fine for three years from the date of the Consent Order.  After three years, the stay would no longer be in force and effect if the Respondents remained unable to pay the fine, and the fine would be waived. 

TradeStation Crypto, Inc.

On January 18, 2024, the Banking Commissioner entered a Consent Order (No. CO-24-2023-48-S) with TradeStation Crypto, Inc. of 8050 SW 10th Street, Suite 2000, Plantation, Florida 13324. The firm offers digital asset trading accounts to clients, and holds a money transmitter license with the Commissioner. The action followed a North American Securities Administrators Association, Inc. multistate investigation and global settlement into the firm’s activities.

The Consent Order alleged that, from approximately August 2020 until June 30, 2022, the firm offered a digital asset trading program featuring the payment of accrued interest to clients, and that, as an unregistered securities product, the offering violated Section 36b-16 of the Connecticut Uniform Securities Act. From August 1, 2020 to June 30, 2022, the firm offered the interest feature accounts to at least 134 Connecticut investors. On or about June 30, 2022, TradeStation Crypto, Inc. discontinued the interest feature product and ceased all lending activities of customer assets.

The Consent Order directed TradeStation Crypto, Inc. to cease and desist from regulatory violations. The Consent Order also fined the firm $29,411.76 which represented Connecticut’s share of the multistate settlement.