Regulators have suspended the securities licenses of Cedar Brook Financial Partners brokers Howard Slater and Michael Perlmuter and firm executive Azim Nakhooda in the wake of allegations that they issued false statements about Medical Capital Holdings Inc. and the IMH Fund, a subprime mortgage-backed security. The sanctions are part of the settlements they reached with the Financial Industry Regulatory Authority.
According to the SRO, Slater, Perlmuter, and Nakhooda also allegedly modified three customer accounts to show false net worth information. Inflating the account balances on paper made the areas of the clients’ portfolios that were in risky funds drop below Cedar Brook’s guidelines that such investments are not to go up over 20% of a person’s holdings. Inaccurate statements were purportedly made via email.
All three men agreed to settle the FINRA allegations without denying or admitting the allegations. As part of their agreements, Perlmutter will pay a $40,000 fine and serve an eight-month suspension. Slater is suspended for five months and will pay $30,000.