FINRA Bars Former Sagepoint Financial Broker for Stock Manipulation of an Illiquid OTC Security
Silver Law Group is investigating former Sagepoint Financial, Inc. (CRD# 133763) broker Gary E. Donovan (CRD# 866235) after FINRA permanently barred Donovan for placing limit buy orders for an illiquid OTC security MIXX.
In May 2016, FINRA permanently barred Donovan after he placed 180 buy orders for Mix 1 Life, Inc. (“MIXX”), an illiquid security traded on the OTC Markets, in 90 customer accounts according to the Acceptance, Waiver & Consent (“AWC”) entered into with FINRA. Donovan also placed buy orders in two other accounts owned by himself and his immediate family members, according to the AWC.
According to the AWC, Donovan made the purchases at a stock promoter’s direction. Donovan, according to the AWC, placed 100 limit orders that were matched in amount and price with recently-placed sell limit orders. Donovan’s limit orders were frequently priced above the market and/or inside ask price for MIXX, according to the AWC, and the orders had the effect of stabilizing the price of MIXX at around $6.00 per share.