Cambridge Advisor Suspended For Unauthorized Trading
Kermit Gordon Cable Jr, of Arlington Texas is a stockbroker formerly registered with Cambridge Investment Research and investment advisor representative formerly registered with Cambridge Research Advisors Inc. who is subject of a Texas State Securities Board Order which suspended him in an investment advisory representative capacity for one-hundred fifty days founded on allegations that he improperly traded in customer accounts. In the Matter of the Investment Advisor Representative Registration of Kermit Gordon Gable Jr. Order No. REG17-SUS-03 (Apr. 10 2017).
According to the Order, Cable was associated with the Cambridge firms between February 16, 2012 and December 1, 2016, where in his advisory capacity he utilized a block trading account to effect purchases and sales of securities. Evidently, the account enabled him to buy or sell securities for several of his advisory customers at once through placing an aggregate order of the securities. Apparently, the trades were supposed to be allocated among those participating customers at the time that the block trade was filled.
The AWC stated that Cable utilized the block trading account to effect substantial trades; his active trading strategy was supported by it. Apparently, at least two customer accounts were subject of trades in which Cable also traded for his own account. Texas State Securities Board concluded that the allocations of trades had not been distributed evenly to customers’ accounts and Cable’s account. Specifically, some trades involved allocations of securities to Cable’s account only, where in other circumstances, he would allocate trades to the customers’ accounts and not his or allocate trades to only one customer’s account instead of another.
The Order stated that Cambridge Advisors actually set forth specific requirements for its adviser representatives that took part in block trading. Those requirements evidently included a written statement to be furnished by Cable which detailed the customers’ accounts to be affected by the block trade and what allocation would be utilized. Evidently, Cable failed to comply with the firm’s policies in that regard because he never provided any written statement detailing the transactions. Texas State Securities Board found that Cable’s conduct amounted to inequitable practices in providing investment advisory services, which resulted in his suspension having been imposed.
Cable was terminated from Cambridge Investment Research, Inc. on November 29, 2016, based upon accusations that he traded improperly in customers’ accounts.
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