Cantone Accused By Investors Of Private Placement Misconduct
Christine Louise Cantone (also known as Christine L. Gefken) of Eatontown New Jersey a Vice President and Chief Compliance Officer of Cantone Research Inc. is the subject of a customer initiated investment related complaint which was resolved on February 14, 2019 for $42,500.00 in damages based upon accusations of Christine Cantone’s failure to supervise a transaction involving the customer’s purchase of a Certificate of Participation in a third party promissory note which defaulted in 2015 resulting in the customer’s losses.
This is not the first time that Cantone has been referenced in an investment dispute containing allegations of her wrongdoing at Cantone Research. Financial Industry Regulatory Authority (FINRA) Public Disclosure reveals that Cantone is referenced in a customer initiated investment related arbitration claim which was settled for $800,000.00 in damages based upon allegations that the customer was defrauded as a result of a Ponzi scheme. According to the claim, the customer’s funds were converted or stolen by the stockbroker under Christine Cantone’s supervision. A fiduciary duty that was owed to the customer had been breached by the stockbroker in reference to the sale of fictitious investments.
FINRA Public Disclosure confirms that Christine Cantone has been fined $600,000.00 and ordered to pay $1,800,000.00 in restitution by New Jersey Bureau of Securities founded on accusations against Christine Cantone including violation of New Jersey securities laws in regard to her failure to preserve records relating to private placements and her failure to supervise Cantone Research’s stockbrokers with a view towards preventing violations of New Jersey securities laws. Consent Order No. ESX-C-252-15 (June 13, 2017).
Christine Cantone has also been suspended by New Jersey Bureau of Securities in all capacities for nineteen months according to an Administrative Consent Order based on accusations of her failure to supervise at Cantone Research. In the Matter of Christine L. Cantone et al. According to the Bureau of Securities, stockbrokers of Cantone Research effected sales of fraudulent securities called Certificates of Participation during the time that they were supervised by Christine Cantone. Stockbroker Maxwell B. Smith–a former stockbroker of Cantone Research–allegedly effected sales of $10,000,000.00 in Health Care Financial Partnership Direct Municipal Loans. These HCFP Loans had not been registered with the Bureau and were purportedly fictitious investments. The Bureau found that Christine Cantone’s failure to supervise was violative of N.J.S.A. 49:3-58(a)(2)(vii). The Bureau also found that Christine Cantone neglected to maintain documentation relating to customers’ objectives for investing and other personal information in violation of N.J.S.A. 49:3-58(a)(2)(ii).
On January 16, 2019, Cantone was fined $73,000.00 and suspended for two years from associating with any FINRA member in any capacity according to a National Adjudicatory Council Decision containing findings that she failed to supervise her husband Anthony Cantone who defrauded investors that purchased Certificates of Participation tied to projects and ventures operated by Christopher Brogdon. In the Matter of Department of Enforcement v. Christine Cantone et al. Decision No. 2013035130101. FINRA found that customers were deprived of information about the Certificates of Participation as well as negative information about Brodgon’s finances. Christine Cantone’s conduct was violative of FINRA Rules 2010 and NASD Rule 3010(a).
Christine Cantone had been registered with Cantone Research since May 28, 1996.