SOUTHFIELD, Mich., Aug. 11 LAWFUEL – The Law News Network – Following two years of cooperative discussions, Southfield, Michigan-based Hantz Financial Services
Inc. (HFS), and the firm’s President John Hantz, have reached a settlement
with the National Association of Securities Dealers (NASD).
According to the agreement, Hantz Financial and John Hantz neither
admitted nor denied the NASD charges, but consented to the NASD’s findings in
order to resolve this matter. NASD fined HFS and Mr. Hantz for non-scienter-
based fraud and misrepresentations related to undisclosed revenue sharing
arrangements. The attorney representing both HFS and Hantz, Bradley J. Schram
of the Bloomfield Hills, Michigan law firm Hertz, Schram and Saretsky P.C.
said, “HFS and Mr. Hantz ultimately consented to relief that was non-scienter,
the legal term for unintended.”
HFS has agreed to pay a $675,000 fine and John Hantz, individually, has
agreed to a censure and a fine of $25,000, and a 30 day suspension from acting
in a supervisory capacity.
Although these revenue sharing arrangements amounted to only 7% of the
firm’s revenue, and were not paid by the clients, the firm consented to the
NASD’s request that this information be provided to the clients.
Schram added, “It has always been the intent of HFS and Mr. Hantz to place
the best interest of their clients first. To the best of my knowledge, no
clients have ever complained or initiated any legal action based upon these
charges.”
The firm also voluntarily agreed to implement procedures to satisfy the
NASD’s disclosure concerns, making specific and immediate disclosures on its
Web site about conflicts, updating of policies, procedures, and training to
ensure oversight.
HFS is a full-service financial holding company operating primarily in
Michigan and Ohio.
