SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
SECURITIES EXCHANGE ACT OF 1934
Rel. No. 40647 / November 9, 1998
Admin. Proc. File No. 3-9555
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In the Matter of the Application of :
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JAMES S. PRITULA :
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For Review of Disciplinary Action Taken by the :
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NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. :
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OPINION OF THE COMMISSION
REGISTERED SECURITIES ASSOCIATION -- REVIEW OF DISCIPLINARY
PROCEEDINGS
Violations of Rules of Fair Practice
Conduct Inconsistent with Just and Equitable
Principles of Trade
Failure to Comply with Net Capital,
Recordkeeping, and Reporting Requirements
Financial and operations principal was responsible for
failure of member firm of registered securities association
to comply with net capital, recordkeeping and reporting
requirements. Held, association's findings of violations
and the sanctions it imposed sustained.
APPEARANCES:
James S. Pritula, pro se.
Alden S. Adkins, Norman Sue, Jr., Susan L. Beesley, and
Shirley H. Weiss, for NASD Regulation, Inc.
Appeal filed: March 9, 1998
SNIPPETS:
REGISTERED SECURITIES ASSOCIATION -- REVIEW OF DISCIPLINARY PROCEEDINGS
Conduct Inconsistent with Just and Equitable
Principles of Trade
James S. Pritula, pro se.
Alden S. Adkins, Norman Sue, Jr., Susan L. Beesley, and Shirley H. Weiss, for NASD
James S. Pritula, formerly the financial and operations principal of Fin-Atlantic Securities,
The NASD found that Pritula permitted the Firm to conduct a securities business, on November
The NASD also found that Pritula failed on behalf of FAS to give prompt notice to the
Pritula further caused FAS to fail to maintain a current and accurate general ledger trial
The NASD concluded that Pritula thereby violated Article III, Sections 1 and 21 of the Rules
As FINOP for FAS, Pritula prepared the Firm's November 1994 FOCUS report, in which the Firm
Pritula included in the Firm's capital calculation a $20,000 capital infusion purportedly
Upon receipt of the FOCUS report, the NASD staff observed that Surman's capital infusion was
The deposit slip, however, indicated that the check was not actually deposited until December
The Firm also did not accrue accounts payable of $2,019.09 or commissions payable to its
Pritula contends that he properly included Surman's $20,000 check as an allowable asset in
broker-dealer could not pay but had not been credited to the
Pritula claims that Surman was responsible for the December 16 net capital violation because
Pritula further asserts that he relied on an opinion by counsel suggesting that, because of
Pritula's duties included "supervision of and responsibility for individuals who are involved
Pritula argues that the sanctions -- a censure, $3,000 fine, and costs -- are excessive.
Pritula was responsible for allowing the Firm to violate recordkeeping and reporting
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