The Financial Industry Regulatory Authority (FINRA) has imposed fines on Investment Network, Inc (INI) and its CEO Gary L. Arnold.
INI engaged in various types of misconduct in connection with recommendations and sales to retail customers of private placement offerings of pre-initial public offering (pre-IPO) funds (the Offerings) that took place between October 2020 and May 2021.
INI engaged in a deceptive course of business by misrepresenting to investors that it would receive only a ten percent sales commission from its sale of the Offerings when, in fact, INI had an agreement with the Offerings’ issuer (the Issuer) to receive an additional five percent in selling compensation as well as half of any carried interest. INI never disclosed this agreement or the additional compensation it would receive to investors.
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