Shammami v. Allos et al

Filing 1

COMPLAINT filed by Mouayad Shammami against Alfred M. Allos, Broad Street Securities Inc., Stuart Burchard with Jury Demand. Plaintiff requests summons issued. Receipt No: 0645-2969573 - Fee: $ 350. County of 1st Plaintiff: Wayne - County Where Action Arose: Wayne - County of 1st Defendant: Oakland. [Previously dismissed case: USDC-EDMI, 2:07-cv-14214, Judge Duggan, Patrick J] [Possible companion case(s): None] (Attachments: # 1 Index of Exhibits, # 2 Exhibit, # 3 Exhibit, # 4 Exhibit, # 5 Exhibit, # 6 Exhibit, # 7 Exhibit) (Sullivan, Donald)

o

STATE OF MICHIGAN
DEPARTMENIOT ENERGY,LABOR & ECoNoMIc GRowrH
OT'F'ICE FINANCIAL AND INSURANCEREGULATION
OF
Before Commissioner the office of Financial Insurance
the
of
and
Regulation
In the matter of:
Broad StreetSecuritieso
Inc.
8751W. Broward Boulevard Suite307
Plantation,Florida 3.JlZ4

EnforcementCaseNo. 09-T140

cRD #36101
Respondent

Issued entered
and
On.,fiu2r1_27,
2009
byStephen Hilker
R.
Chief
Deputy ommissioner
C

FINDINGS PF FACT
The staff of the office of FinancialandInsurance
Regulation("OFIR,') alleges
that the
following factsaretrue andcorrect:

l. BroadStreet
Securities, (,,Broad
Inc.
Street',) a Broker-Dealer
is
Firm formed in Nevada
onJanuary
3I,Igg4, whose
mainofficelocaiion currentlylocatedat BTS|W. Broward
is
Boulevard,
Suite307,plantation,
Florida33324,

Summary
$uspension
Order
Enforcement No. 09-7140
Case
Page2
of7

2 . BroadStreet
conducts separate
nine
typesofbusiness,
including:serving

asa brokeror
dealer.
retailing.
corporateequity securities
over-the-co;;, mutual fund retailer,
municipal
secwities
broker,
brokeror dealer
sellingrrariaui.iir, insurance annuities,
or
brokeror dealersellingoil and gasinterests, and call
put
brokeror dealeror option
wrifer, investment
advisoryservices,
broker-oi dealerr.ffing tax shelters limited
or
partnerships primary
in
distributions, private
and
placement secwities.
oi

3 . Broadstreet been
has
registered operate Michigan of June lgg4.
to
in
as
3,

4' on June18,2008,the OFIRreceived
a-complaint
against
Broadsfteet,The complaint
alleged
certainviolations the Aci, whichuponreview wasdeemed
of
to merit further
investigation.
5" On August 2008,a letterwassentvia
8,
the authoriry sections
of
407(a)(Z),
MCL ,
theAct; thefiling of a signed,
witt*n ,tut
to the undertaken
investigation. letter
The
15daysof receipt theletter
of
6' The letterwasreceived August18,2008,as established
on
postal
by the united states
Service's
Trackand ConfirmProgram. OFIR received signed
The
a
no*rrti. Retum
Receipt theabove
for
letteronAugust
ZZ,Z00g.
7' TheOFIRreceived response its August 200gletter.
g,
no
to
8' on September
24,2008, OFIRfaxed second
the
a
letter Broadstreet
to
notiffingBroad
streetthat the OFIR had not, to date,received ..*ponseto its
uny
initial letter.The
secondletter reasserted OFIR's authorityto requireinformation
the
under Section
407(a)(2),
MCL 451.807(a)(2) 407(b),
and
vir +sr.rioTplof theAct andstated
that
failureto respond
pursuant Section MCL 4ll.g07 is a violation theAct which
to
407,
of
jeopardizes
Broadstreets
registration thestateof Michigan.
in
9' on october 10, 2008,the OFIR opened enforcement
an
actionto address nonthe
compliance theAugust 200g september
to
8,
and
24;200g
leuers.
10'OnDecember 200,8 11:48 a letter sent facsimile
18,
at
am,
was
via
to Ms.Maryp. Mada,
Chief Compliance
officer for BroadStreet
Securities, inaicating, a negotiated
lnc.
per
agreement, theOFIRwouldrefrain
that
fromissuing Summary
a
Surpittsion
Order
under
MCL 451.603(d) theAct if theinformation
of
requested the August8,
!:gtlo" 203(d),
in
2008letter received OFIRby 10:00 onDecember
was
by
am
zt,ioog.

Summary
Suspension
Order
Enforcement No.0g-7140
Case
Page of 7
3

il'on December
i8,2008 at 7:44pm the OFIR received
via facsimilethe information
requested the August 8, 2008 lefier under cover letter from
in
Ms. U"ry fr4ud";i;;;;
Vice President.
12' Having receivedthe informationrequested, oFIR closedits
the

enforcement
action.

13.On December23,2008, a letter was se
under the authority of section 407'a
451.807(b)of the Act, the filing of'e
infonnation pertinent to the und.ertaker
informationbe filed within 15 daysof rec
i4' The letter was receivedon Decemb 29,2008"as established
er
postal
by the United States
ServiceTrack and Confirm program.
15.On January16,2009, the OFIR advised
SummarySuspension non complianc
for
specificinformationpertinentto its inves
closed on Monday, January lg, 2009, t
Order if the information requested
was provided by January20,
lyqmarf Suspension
2009.
16' On January 20, 2009, the information was received by the OFIR in
responseto its
December 23, 2008
requesting information Uv facsimile pertiient to its
-letter
investigation
from Ms. Mary p. Mada,seniorvice president.
lT.Included in the informationreceived facsimiiewas informationin
via
response item
to
number 10 of the December23,20081etter
which requested
Broad Streetto providea list
of, and pertinentinformation regarding,all investori in the Stateof Naicfrigan
who had
purchased
stockshares a particularcompany.
of
18.The January20, 2009 response
includ.ed
information on four Michigan investorswho
purchased
stockshares the par-ticular
of
company.
19' on February6,2009, the OFIR senta letter via certified mail to Broad Street
requiring,
under the aurhoriry of sections 407(a)(z), MCL 451.g07(aX2) and a07ft);^
MC-L
451.807(b) of the Act, the filing of a signed, vwitten statementincluding
specific
infonnation perlinent to the undertakeninvestigation.The letter requested
that the
informationbe filed within 15 daysof receiptof thi letter.
20' The February 6, 2009 letter requeste a list of, and pertinent information
regarding,
_
investors
nationwidewho hadpurchased
shares the samecompanyaddressed
of
above.
21.The letterwas received February
on
1"2,2009, established the United States
postal
as
by
Service'sTrack and Confirm program.

Summary
Suspension
Order
Enforcement No. 09-7I40
Case
Page of 7
4

22'9!
the
a
to
$lruary 27,2009, OFIRreceived response its February 2009letter
6,
from
Ms' Mary P. Mada,which included nationalHst of investors
.,i'rr"p*.irased stock
a
shares the company question.
of
in
23' Thelist provided
indicates
several
investors
who areMichiganresidents purohased.
that
stockshares
o{
coTpany question werenot previously
in
who
disclosed the 6FIR
to
P*.
whenrequested its Decemb i3, z00g
in
er
letter.
24' Ms' Mada indicated her response BroadStreet
in
that
was havingproblems
locating
certain
requested
information, wouidsend by facsimile rvron=aui,
but
it
tv
nlur"r,2,2009.
25'As of this date,the information
promised Broadstreethasnot beenreceived the
by
by
OFIR,

coNsl.rusroNs r4,lY
oF
26' Sectiona07@)(2)of the Act statesthe Administrator,
in his
',rnd,.. discretionmay require or
any person to file a statementin writing,
rymit
oath or otherwise as .the
administrator
determines, to all the factsand .it .ri.rt*.es concerning
as
the matterto be
investigated"
The OFIR issued a "15 day retter,,;-q;l"g
a statementi" *rirt-;-;;
provided BroadStreet.
by
ryoseof any investigation proceeding
or
under
designated it, may administeroaths and
by
their attendance,
take evidenceand requirethe
pondence,memoranda,agreementsor other
ratordeemsrelevantor materialto the inquiry.
The OFIR issueda "15 day letter" to Broad Streetrequiring
ttre proou"ti;^ ;f various
rccords,
;isteredbroker-dealer
and investmentadviser
dencememoranda:
popofs, books, and other
rder prescribes.
The OFIR requestedrecords
].i asindicated
below.
29' Rule 603.1 to the Act statesbroker-dealers
shall keep curent the following books and
records
relatingto its business:
(a) Blotters,or otherrecordsof original enfry,containing
an itemizeddaily recordof
all purchasesand sales of securities,all receipts and deliveries
of securities
(including certificatenumbers),all receiptsand disbursements
;i ;lt
and all
otherdebitsand credits.

Surnmaly
Suspension
Order
Enforcement No. 09-7
Case
140
Page of 7
5

(o)

or otherrecords,reflectingall assets liabilities, and income,
and
expense,
l_-$q:tj;
and capitaiaccounts.
(c) Ledgeraccounts, otherrecords,
or
itemizingseparately to eachcashand margin
as
accountof every customer
and of suchmembei,broker,or dealerandthe parhrers
thereof all purchases, . sales, receipts, and deliveries
of securities and
commodities that accountand all otherdebitsand credits
for
of that account.
(d) Ledgers,or otherrecords,
reflectingthe followine:
(i) Securities transfer.
in
(ii) Dividendsandinterestreceived.
(iii) Securities
borrowedand securities
loaned.
(i") Monies borrowedand moniesloaned,together
with a record of the
collateralthereforandany substitutions
in-suchcollateral.
(v) securitiesfailed to receiveandfailed to deriver.
(e) A securitiesreco_rd ledger reflecting separately
or
for each security as of the
cleatance
date- "long" or "short" positions,incluiing securities
of
ir, ,furt.rpirrg,
carriedby eachmember,broker,or dealerfor his accountor
for the accountof his
customers or partners,and showing the location of all securities
long and the
offsettingpositionto all securities
shortand,in a1l cases, nameor designation
the
of the accountin which eachpositionis canied.
(0 e memorandum eachbrolerage order,and of any
of
other instruction,given or
received the purchase saleofsecurities,whetherexecuted
for
or
or unexecuted.
(g) A memolan{um of eachpwchaseand sale of securities
for the accountof such
or dealer,showingthe price and,1o the extentfeasiUie,
the time
1ember,.lroker,
or executlon.
(h) Copies of confirmationsof all purchases
and sale of securitiesand copies of
noticesof all other debitsand creditsfor securities,
cash,and other items for the
account customers partners suchmembbr,broker,or dealer.
of
and
of
30' se"ction203(d) of the Act statesall recordsrefened ro in
section 203(a)(supra) arc
subject at any time or fiom time to time to reasonableperiodic,
*p**iui, or other
exam.inations representatives the Administrator,within
by
of
or without this state,as the
Administrator considersnecessaryor appropriatein the public
interest or for the
protection of investors"The expsnses
r.lioniuty anributabieto the examinationof a
to
!{ter arising underthis sectionmay be charged the applicantor t.girtr;iinvolved.
Failure of a registrantto promptly provide recordsfor inspection
shjl be causefor a
SummarySuspension
order until conclusionof the examinationof the records.Broad
Street provided incomplete information as to the oFIR's
January tb, zOog t.tt*
rn regarding Michigan citizens who were
r, as indicatedby the disclosure
ofadditional
response.
Broad Sffeetalsohasnot provided
uy 27,2009 response
would be delivered
on
March2,20Ag.

Sumrnary
Suspension
Order
Enforcement No. 09.7140
Case
Page of 7
6

ORDER
ct, (MCLa5t.S07(a)(2)) rhat
srates the
permitanyperson file a statement writing,
to
in
lermines, to all thefactsandcircumstances,
as
:MCL451.907(b)) for thepwpose any
stares
of
dministratot,ol officerdesignaied it, may
by
T{
htesses,
compel
theirattendance, evidence
take
correspondence,
memoranda,
agreements
or
atordeems
relevant material theinquiry;
or
to

inu**ti#*Tff*'

information requested Broad
was
from
street
regarding matter
a
being

WHEREAS, information
the
requested.
consisted records
of
to bemaintained
by
Broadstreet
under
section
203(a) theuniro"" ir*u*tAl, andryquired ro
of
Rule603.1 theAct; and
WHEREAS, information
the
requested notprovided BroadStreetr
was
by
and
WHEREAS,
Secrion
203(d) theAct sr
of
subject anytimeor fromtimeto'timeto reaso:
at
representatives administrator,
of the
withinor wj

WHEREAS,
BroadStreet a docurnented
has
previous
history non-responsiveness
of
to
requests production documents information the
for
of
and
by otrn; and
WHEREAS, Administrator
the
findsthis order necessary appropriate the public
and
in
interest, the prot€o-tion investors, consistent
for
of
and
with thepurposes
fairly intended the
by
policyandprovisions
ofthe Act;
IT Is THEREI'OREORDERED,,pursuantsection
to
203(d)
451'603(d) therespondent SUMMARILY SUSpENDED of theAct, (MCL
that
is
fromtransacting
business
in
the State Michigan
of
until such
timeasthefollowingrequirements occurred:
have
1'

Respondent supply records documents requested
shall
all
and
as
to date the
by
OFIRfor review:
and

Summary
Suspension
Order
Enforcemen! No.09_TI40
Case
Page of7
7

2'

3'

Re1|on{entshallpay to the.state of Michigan

the expenses

reasonably
anributabre examinarion recor;s
tothe
of the
;.q".Gil;;"aj*e'rhi,
enforcement which in sum oneTiousand
action,
total
poit'arsi$t,000);
to
and
Respondent
shall discJose its nationalregistration
on
the occurrence this
of
summarysuspension.

that you presentin response this Ordermav
to
tant to understand you havethe right, at
that
at a hearing
:ould be addressed the Office of Financial
to
rberg,Securities
p"O.Box j0220"
Counsel,

OFFICE FINANCIALAND INSURANCE
OF
REGULATION
By:
ChiefDeputy
Commissioner