Oran Ben Carroll, a former broker with Dallas, Texas based Cambridge Legacy Securities L.L.C., submitted a Letter of Acceptance, Waiver and Consent in which he consented to the entry of Financial Industry Regulatory Authority (FINRA) findings that, acting in his capacity as the president and a registered principal of Cambridge Legacy Securities, he failed to conduct adequate due diligence of private placements (PPMs) offered by Cambridge Petroleum Group (CPG). The five CPG offerings were the CPG 2005A, CPG 2005B, CPG 2006A, CPG Opportunity I, and CPG Opportunity II, and Mr. Carroll's firm sold $22,900,000 in interests to its customers. Cambridge Legacy Securities also sold $900,000 in interests in the Cambridge Legacy Group (CLG) offering to its customers - Mr. Carroll is the CEO and Chairman of CLG.
FINRA found that Mr. Carroll, who was affiliated with the issuers, failed to implement and enforce reasonable supervisory procedures for the firm relating to conducting due diligence on PPMs from August 2005 through September 2010. FINRA found that Cambridge Legacy Securities did not have any written supervisory procedures (WSPs) governing due diligence for PPMs until January 2008. After January 2008 until at least September 2010, Mr. Carroll failed to enforce the firm's WSPs that required it to conduct due diligence for all PPMs the firm sold. FINRA also found that Mr. Carroll failed to ensure that Cambridge Legacy Securities created and maintained due diligence files and conducted on-going due diligence, as required by its WSPs, so it did not create or maintain due diligence files or conduct on-going due diligence on the offerings.
Mr. Carroll, of Granbury, Texas, was fined $50,000 and suspended from association with any FINRA member in any capacity for nine months. The fine must be paid either immediately upon Mr. Carroll's re-association with a FINRA member firm following his suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. Mr. Carroll's suspension is in effect from March 4, 2013 through December 3, 2013.
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