2019 Division of Securities Enforcement Actions

Orders From Other Years

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Tao Yang and 1476257 Alberta Ltd. - S-19-2701-19-FO01 - Final Order

On October 24, 2019, the Securities Division issued an Entry of Findings of Fact and Conclusions of Law and Final Order to Cease and Desist (“Final Order”) against Tao Yang and 1476257 Alberta Ltd. (Respondents). The Securities Division previously entered a Statement of Charges against the Respondents on September 25, 2019. The Respondents offered and sold franchises in Chatime USA, LLC to three Washington state residents while not registered to do so, and failed to provide prospective franchisees with a franchise disclosure document with current material information about the franchise offering. The Securities Division ordered the Respondents to cease and desist from violations of RCW 19.100.020 and RCW 19.100.080, the franchise registration and the franchise disclosure document sections of the Franchise Investment Protection Act. The Respondents have a right to request judicial review of the matter.


Franchise Equity Group, Inc. – S-19-2705-19-FO01 - Final Order

On October 17, 2019, the Securities Division entered a Final Order against Franchise Equity Group, Inc., and Franchise Equity Consortium Group, Inc. (Respondents). The Final Order finds Respondents offered and sold securities to a Washington resident between 2013 and 2017 without registering their offerings with the Division in violation of the Securities Act of Washington. In connection with the offer and sale of securities, Respondents did not disclose that one of its officers and salespeople was subject to a permanent injunction against violating federal securities law because of the fraudulent sale of $44.7 million in oil and gas investments from over 1,000 mostly elderly investors, or his civil contempt order for failing to pay more than $6.3 million in disgorgement entered against him by a federal district court in the mid-1990s. Additionally, this officer represented to the Washington resident that the resident was purchasing shares in an investment group comprised of former employees of a well-known billionaire investor, but did not disclose the names of these employees to allow the resident to confirm the investor group’s previous employment and sophistication. This officer told the Washington resident he could expect unusually high returns for his investment, but did not provide a basis for these returns, and Respondents abruptly ceased communicating and making distributions in 2017. The Final Order finds that these misrepresentations and omissions violated the anti-fraud provision of the Securities Act of Washington. Respondents had the right to request an administrative hearing on the Statement of Charges, but did not make a timely request for such a hearing. The Final Order orders Respondents to cease and desist from violating the Securities Act of Washington, to pay a $70,000.00 fine, and to pay investigative costs. Respondents each have a right to request judicial review of the Final Order.


SeaTech Trade Associates, LLC; Kim Brian Boddy - S-18-2372-19-FO01 - Final Order

On October 11, 2019, the Securities Division entered a Final Order against Respondents, Kim Brian Boddy (“Boddy”) and SeaTech Trade Associates LLC (“SeaTech”). On September 5, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, to Impose a Fine, and to Charge Costs (“Statement of Charges”) against the Respondents. The Statement of Charges alleged that the Respondents offered and sold at least $25,000 worth of investments to at least four investors. The Statement of Charges also alleged that the Respondents violated the registration and anti-fraud provisions of the Securities Act of Washington. The Respondents, Boddy and SeaTech, each failed to make a timely request for a hearing on the Statement of Charges. The Final Order orders SeaTech and Boddy to cease and desist from all violations of the Securities Act and orders Boddy to pay a fine and investigative costs. The Respondents may request judicial review of the Final Order.


Pacific Rim Energy, Inc; Stephen B. McKanna - S-17-2324-19-FO01 - Final Order

On October 10, 2019, the Securities Division entered a Final Order against Pacific Rim Energy (“PRE”), and Stephen B. McKanna (“McKanna”) (collectively, “Respondents”). The Division entered a Statement of Charges against the Respondents and Gregory D. Mrachek (“Mrachek”) on September 9, 2019. The Statement of Charges alleged that Mrachek and McKanna sold at least $124,500 worth of investments in PRE to ten investors, nine of whom are Washington residents. In doing so, the Statement of Charges alleged that the Respondents violated the Washington State Securities Act’s (the “Act”) securities registration and anti-fraud provisions, and that Mrachek and McKanna each violated the Act’s securities salesperson registration provision. The Statement of Charges gave notice of the Division’s intent to order the Respondents to cease and desist from violating the Act, and to impose fines on, and to collect its investigative costs from the Respondents. PRE and McKanna each failed to request an administrative hearing on the Statement of Charges in the period allowed. The Final Order orders the Respondents to cease and desist from violating the Act. The Final Order also orders the Respondents to each pay a fine of $10,000, and to reimburse the Division’s costs. The Respondents may request judicial review of the Final Order.


Sign Gypsies LLC - S-19-2747-19-CO01 - Consent Order

On October 9, 2019, the Securities Division entered into a Consent Order with Sign Gypsies LLC (Respondent). In the Consent Order, the Securities Division alleged that the Respondent violated the Franchise Investment Protection Act by offering and selling franchises between 2016 and 2019 to Washington residents, while not registered to do so. Without admitting or denying the Securities Division’s allegations, the Respondent agreed to cease and desist from the registration and franchise disclosure document portions of the Franchise Investment Protection Act. The Respondent agreed to pay investigative costs of $500 and waived its right to a hearing and judicial review of the matter.


Muchas Gracias Franchising LLC - S-19-2757-19-CO01 - Consent Order

On September 27, 2019, the Securities Division entered into a Consent Order with Muchas Gracias Franchising LLC (Respondent). In the Consent Order, the Securities Division alleged that the Respondent violated the Franchise Investment Protection Act by offering and selling franchises to Washington residents while not registered to do so. Without admitting or denying the Securities Division’s allegations, the Respondent agreed to cease and desist from violating the registration section of the Franchise Investment Protection Act. The Respondent agreed to pay investigative costs of $1,000 and waived their right to a hearing and judicial review of the matter.


WebRotator, Inc, Scott B. Wilkerson - S-17-2138-19-FO01 - Final Order

On September 27, 2019, the Department of Financial Institutions entered a Final Order against WebRotator, Inc. and Scott B. Wilkerson (“Respondents”). The Securities Division had previously entered a Statement of Charges against Respondents on February 22, 2019. In the Statement of Charges, the Securities Division alleged that Respondents offered and sold approximately $167,500 of investments to ten investors in violation of an earlier Consent Order and the Securities Act of Washington. On July 30, 2019, Administrative Law Judge Pierce entered an Order Dismissing Appeal – Default after Respondents failed to appear at a prehearing conference. In the Final Order, the Department Director adopts the Findings of Fact and Conclusions of Law in the Statement of Charges, orders Respondents to cease and desist from violations of the Securities Act, and orders Respondents to pay fines and costs totaling $65,000. Respondents have the right to petition for reconsideration and judicial review of the Final Order.


Nutrishop Inc. - S-19-2724-19-CO01 - Consent Order

On September 25, 2019, the Securities Division entered into a Consent Order with Nutrishop, Inc. (Respondent). In the Consent Order, the Securities Division alleged that the Respondent violated the Franchise Investment Protection Act by offering and selling franchises for two locations in Washington while not registered to do so, by failing to provide prospective franchisees with a franchise disclosure document with current material information about the franchise offering, and by failing to disclose material information regarding prior litigation. Without admitting or denying the Securities Division’s allegations, the Respondent agreed to cease and desist from violating the registration and disclosure document portions of the Franchise Investment Protection Act. The Respondent agreed to pay investigative costs of $1,000 and waived its right to a hearing and judicial review of the matter.


Tao Yang and 1476257 Alberta Ltd. - S-19-2701-19-SC01 - Statement of Charges

On September, 25, 2019, the Securities Division issued a Statement of Charges against Tao Yang and 1476257 Alberta Ltd. (Respondents). In the Statement of Charges, the Securities Division alleged that the Respondents violated the Franchise Investment Protection Act by offering and selling franchises in Chatime USA, LLC to three state residents while not registered to do so, and by failing to provide prospective franchisees with a franchise disclosure document with current material information about the franchise offering. The Securities Division intends to order the Respondents to cease and desist from violations of RCW 19.100.020 and RCW 19.100.080, the franchise registration and the franchise disclosure document sections of the Franchise Investment Protection Act. The Respondents each have an opportunity for a hearing in this matter.

A Final Order was entered regarding this matter on October 24, 2019.


Boris Desancic - S-19-2706-19-CO01 - Consent Order

On September 17, 2019, the Securities Division entered into a Consent Order S-19-2706-19-CO01 with Boris Desancic (CRD 2642815) (“Consent Order”). The Consent Order states that Mr. Desancic was terminated as an investment adviser representative from his employing firm for violating the firm’s policy on private securities transactions. In the Consent Order Mr. Desancic agreed that before an application for registration as an investment adviser representative for him is approved, his sponsoring firm must provide the Securities Division an acceptable plan of supervision. Respondent waived his right to judicial review of the matter.


RedRhino Group, Inc. a.k.a. RedRhino, Inc. and Michael Kenealy – S-16-2021-19-FO01 - Consent Order

On September 16, 2019, the Securities Division entered a Final Order against RedRhino Group, Inc. a.k.a. RedRhino, Inc. and Michael Kenealy (“Respondents”). The Securities Division had previously entered a Statement of Charges against the Respondents on May 10, 2019. The Securities Division alleged that Respondents failed to disclose material facts while offering and selling an unregistered RedRhino, Inc. franchise opportunity. In the Final Order, the Respondents are ordered to cease and desist from violating the registration and violations sections of FIPA. The Respondents each have the right to request judicial review of the Final Order.


New Wave Innovations; Allan Magneson - S-18-2501-19-FO01 - Final Order

On September 16, 2019, the Securities Division entered a Final Order against Alberta resident Allan Magneson (“Magneson”) and his corporation New Wave Innovations (“New Wave”), a business that purports to be developing a silent dental drill. On August 21, 2019, the Division entered a Statement of Charges against New Wave and Magneson. The Statement of Charges alleged that Magneson sold at least $85,000 worth of New Wave Innovations stock to no fewer than eight Washington investors. The Statement of Charges also alleged that, in selling this stock to Washington residents, and that Magneson and New Wave violated the Washington State Securities Act’s (the “Act”) securities registration and anti-fraud provisions. The Statement of Charges also alleged that Magneson violated the Act’s securities salesperson registration provision. Magneson and New Wave each failed to make a timely request for a hearing on the Statement of Charges. The Final Order orders Magneson and New Wave to cease and desist from all violations of the Act, to reimburse the Division its investigative expenses, and to pay fines. The Respondents may request judicial review of the Final Order.


Beautiful Surfaces - S-19-2676-19-CO01 - Consent Order

On September 11, 2019, the Securities Division entered into a Consent Order with Respondent Beautiful Surfaces Inc. d/b/a Garage Kings (Garage Kings). The Securities Division alleged in its consent order that Garage Kings sold an unregistered franchise territory to a Washington state resident and failed to provide him with a franchise disclosure document before the sale of the territory. The Securities Division also alleged that Garage Kings failed to provide a basis for financial performance representations it made in connection with the offer and sale of its franchises. Instead of basing these representations on financial data collected from all of its franchisees, Garage Kings based them on anecdotal conversations with territory owners. Without admitting or denying the Securities Division’s allegations, Garage Kings agreed to cease and desist from violations of RCW 19.100.020, the franchisee registration provision; RCW 19.100.080, the franchise disclosure document provision; and RCW 19.100.170, the false or misleading statements or omissions provision of the Washington Franchise Investment Protection Act. Garage Kings agreed to pay investigative costs of $2,281.25 and waived its right to a hearing and judicial review of the matter.


Blue Gold Co - S-19-2694-19-SC01 - Statement of Charges

On September 5, 2019, the Securities Division entered a Statement of Charges against Renton resident Gregory D. Mrachek (“Mrachek”) and his company Blue Gold LP co. (“Blue Gold”) (collectively, “respondents”). The Statement of Charges alleges that Mrachek sold stock and offered debt in Blue Gold without registering that offering or filing a notice of exempt offering. The Statement of Charges also alleges that the respondents made misstatements of material fact and omitted to state material facts about the offering while soliciting investors. In doing so, the Statement of Charges further alleges that the respondents violated the Washington State Securities Act’s (the “Act”) securities registration, securities salesperson registration, and anti-fraud provisions. The Statement of Charges gives notice of the Division’s intent to order the respondents to cease and desist from violating the Act, to charge its investigative costs, and to impose fines against the respondents. The respondents may request an administrative hearing on the Statement of Charges.


SeaTech Trade Associates LLC and Kim Brian Boddy - S-18-2372-19-SC01 - Statement of Charges

On September 5, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, to Impose a Fine, and to Charge Costs (“Statement of Charges”) against Respondents, SeaTech Trade Associates LLC and Kim Brian Boddy. The Statement of Charges alleges that the Respondents offered and sold at least $25,000 worth of investments to at least four investors. The Statement of Charges also alleges that the Respondents violated the registration and anti-fraud provisions of the Securities Act of Washington. The Securities Division intends to order the Respondents to cease and desist from violating the Securities Act and to impose a fine and charge investigative costs. The Respondents each have the right to request a hearing on the Statement of Charges.

A Final Order was entered regarding this matter on October 11, 2019.


AFN Sports, LLC and Fan Sports, LLC - S-18-2572-19-CO01 - Consent Order

On September 4, 2019, the Securities Division entered into a Consent Order with AFN Sports, LLC and Fan Sports, LLC (Respondents). In the Consent Order, the Securities Division alleged that Respondents violated the Franchise Investment Protection Act by offering and selling unregistered franchises to Washington residents, and by failing to provide the franchisees with franchise disclosure documents prior to the sale of the franchises. Respondents have agreed to cease and desist from violating the Franchise Investment Protection Act, and to pay $1,500 towards the costs of the investigation. Respondents agreed to waive their right to a hearing and judicial review of the matter.


Josef Ewert - S-18-2511-19-FO01 - Final Order

On September 4, 2019, The Securities Division entered a Final Order against Respondent Josef Erick Ewert, a/k/a Jay Ellis, a/k/a James Ellis. The Securities Division had previously entered a Statement of Charges against Respondent on July 10, 2019, and Respondent failed to make a timely request for hearing on the Statement of Charges. The Final Order finds that Respondent violated registration sections of the Securities Act of Washington when Respondent offered and sold unregistered investments totaling $16,500 to two investors. The Final Order also finds that Respondent violated the anti-fraud provision of the Securities Act of Washington by failing to disclose material information to the investors. The Final Order orders Respondent to cease and desist from violating the Securities Act of Washington, to pay a fine, and to pay costs. Respondent has a right to request judicial review of the Final Order.


Pacific Rim Energy, Stephen B. McKanna, Gregory Mracheck - S-17-2324-18-SC01 - Statement of Charges

On September 4, 2019, the Securities Division entered a Statement of Charges against Pacific Rim Energy (“PRE”), Gregory D. Mrachek (“Mrachek”), and Stephen B. McKanna (“McKanna”) (collectively, “Respondents”). The Statement of Charges alleges that Mrachek and McKanna, sold at least $124,500 worth of investments in PRE to ten investors, nine of whom are Washington residents. In doing so, the Statement of Charges alleges that the Respondents violated the Washington State Securities Act’s (the “Act”) securities registration and anti-fraud provisions, and that Mrachek and McKanna each violated the Act’s securities salesperson registration provision. The Statement of Charges gives notice of the Division’s intent to order the Respondents to cease and desist from violating the Act, and to impose fines on, and to collect its investigative costs from the Respondents. The Respondents may request an administrative hearing on the Statement of Charges.

A Final Order was entered regarding this matter on October 10, 2019.


Shamero A. Terry d/b/a Urban Traffic - S-18-2408-19-SC01 - Statement of Charges

On August 30 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Issue an Order to Cease and Desist, Impose Fines, and Charge Costs against Shamero A. Terry d/b/a Urban Traffic. The Statement of Charges alleges that the Respondent raised approximately $110,000 from selling unregistered promissory note investments to five investors, including four Washington residents. The Statement of Charges further alleges that the Respondent violated the anti-fraud provision of the Securities Act of Washington. The Securities Division ordered the Respondent to cease and desist from violating the Securities Act of Washington, and gave notice of its intent to collect fines and charge costs. The Respondent has a right to request a hearing on the Statement of Charges.


Thoroughbred National, LLC and Gregory Ferry - S-19-2742-19-TO01 - Summary Order

On August 30, 2019, the Securities Division entered a Summary Order S-19-2742-19-TO01 summarily suspending the investment adviser registration of Thoroughbred National, LLC (CRD 289435) and the investment adviser representative registration of Gregory Ferry (CRD 6864337) (“Summary Order”). The Summary Order also gave notice of the intent to revoke the registrations, impose a fine, and charge costs. The Summary Order alleges that Respondents failed to make Thoroughbred National’s books and records available for examination by the Securities Division. Respondents have a right to judicial review of the matter.


Robert Glenn Hubbard & Pur Beverages, Inc. - S-17-2267-19-FO01 - Final Order

On August 28, 2019, a Final Decision And Order was entered In the Matter of Determining whether there has been a violation of the Franchise Investment Protection Act of Washington by Robert Glenn Hubbard, a.k.a. Rob Hubbard and Pur Beverages, Inc., Respondents.

The Final Decision And Order found that the Respondents, Robert Glenn Hubbard and Pur Beverages, Inc. offered unregistered franchises in the state on the Seattle Craigslist in violation of RCW 19.100.020 of the Franchise Act. The Order found that the Respondents violated RCW 19.100.170, the Violations section of the Franchise Act. The Respondents are ordered to cease and desist from further violations of RCW 19.100.020 and RCW 19.100.170. The Respondents each have the right to petition the superior court for judicial review of the order.


New Wave Innovations, Allan Robert Magneson - S-18-2501-19-SC01 - Statement of Charges

On August 21, 2019, the Securities Division entered a Statement of Charges against Alberta resident Allan Magneson (“Magneson”) and his corporation New Wave Innovations (“New Waves”), a business that purports to be developing a silent dental drill. The Division alleges that Magneson sold at least $85,000 worth of New Wave Innovations stock to no fewer than eight Washington investors. The Division also alleges that, in selling this stock to Washington residents, Magneson and New Wave violated the Washington State Securities Act’s (the “Act”) securities registration and anti-fraud provisions. The Division also alleges that Magneson violated the Act’s securities salesperson registration provision. The Statement of Charges gives notice of the Division’s intent to order Magneson and New Wave to cease and desist from all violations of the Act, to reimburse the Division its investigative expenses, and to pay fines. The Respondents may request an administrative hearing on the Statement of Charges.

A Final Order was entered regarding this matter on September 16, 2019.


360 Tour Designs & Marketing LLC - S-19-2680-19-CO01 - Consent Order

On August 20, 2019, the Securities Division entered into a Consent Order with 360 Tour Designs and Marketing, LLC (“Respondent”). The Securities Division alleged that Respondent violated the Washington Franchise Investment Protection Act (“FIPA”) by offering and selling a territory meeting the definition of a franchise to a Washington resident while not registered with the Division, failing to provide the resident with a franchise disclosure document, and making misleading financial performance representations while offering and selling the franchise. Without admitting or denying the Securities Division’s allegations, Respondent agreed to cease and desist from violating the registration, disclosure document, and violations sections of FIPA, and to pay the Division’s investigative costs. The Respondent waived its right to a hearing and judicial review of the matter.


Party Princess International, LLC - S-17-2288-18-CO01 - Consent Order

On August 19, 2019, the Securities Division entered into a consent order with Respondents Morgan Rothschild f/k/a Morgan Henning and Party Princess International, LLC.

The Securities Division had previously entered a Statement of Charges against Morgan Rothschild f/k/a Morgan Henning and Party Princess International, LLC, alleging that they violated the registration and disclosure document provisions of the Franchise Investment Protection Act of Washington in connection with their offer and sale of Party Princess International franchises in Washington. The Securities Division also alleged that Morgan Rothschild f/k/a Morgan Henning and Party Princess International violated the Franchise Investment Protection Act by making misleading statements to prospective franchisees about the profitability of owning a Party Princess International franchise in Washington.

In the consent order, Morgan Rothschild f/k/a Morgan Henning and Party Princess International neither admitted, nor denied the order’s Findings of Fact and Conclusions of Law. As part of the consent order, Morgan Rothschild f/k/a Morgan Henning and Party Princess International further agreed to each cease and desist from violations of the Franchise Investment Protection Act.

Both Morgan Rothschild f/k/a Morgan Henning and Party Princess International waive their right to a hearing and judicial review of this matter.


Philip Bayley; Bayley Financial Inc. - S-19-2605-19-CO01 - Consent Order

On August 19, 2019, the Securities Division entered into a Consent Order with Respondents Philip Bayley (CRD #5409291) and Bayley Financial Inc. (IARD #156442) (collectively “the Respondents”). The Securities Division had previously entered a Statement of Charges against the Respondents, alleging that they violated the suitability requirements of the Securities Act of Washington by (a) failing to collect required information from clients; (b) making unsuitably risky investments in a triple-leveraged inverse exchange-traded fund of mining stocks; (c) concentrating clients entirely in the stock of one mining company; (d) recommending the use of margin trading to purchase additional stock in that company without analyzing whether margin was appropriate for the clients; and (e) recommending that clients convert standard IRAs to Roth IRAs without analyzing information such as their tax status and available liquid funds to cover the substantial resulting tax bills. The Securities Division further alleged in the Statement of Charges that Bayley failed to disclose in writing the material conflict of interest created by his personal ownership of substantial amounts of Tahoe stock. Without admitting or denying the Securities Division’s allegations, the Respondents agreed to cease and desist from violating the Securities Act of Washington, to pay $1,000 in investigative costs, and to refrain from applying for registration with the Securities Division as an investment adviser, investment adviser representative, broker-dealer, or securities salesperson. The Respondents waived their right to a hearing and judicial review of this matter.


Henry Krist – S-19-2643-19-CO01 - Consent Order

On August 14, 2019, the Securities Division entered into a Consent Order S-19-2643-19-CO01 with Henry Krist (CRD 3061810 and 116154) (“Consent Order”). The Consent Order states that Henry Krist failed to maintain certain books and records required by the investment advisory rules. In the Consent Order Mr. Krist agreed to withdraw his investment adviser and investment adviser representative registrations; that he may not act as a principal, officer, or owner of an investment adviser or broker-dealer for ten years; and that he may not register as an investment adviser or broker-dealer. Respondent waive his right to judicial review of the matter.


My Covenant Love - S-19-2697-19-FO01 - Final Order

On August 14, 2019, the Securities Division entered a Final Order against the Respondents, My Covenant Love Inc.; Kenneth Renard Smith (“Smith”); and Martha Solomon (“Solomon”). The Respondents each failed to make a timely hearing request on the initial Statement of Charges. The Final Order finds that the Respondents offered and sold a total of more than $25,000 worth of investments to at least 10 Washington investors. The Final Order also finds that the Respondents each violated the securities registration and anti-fraud provisions of the Securities Act of Washington (“Securities Act”) and that Smith and Solomon each violated the securities salesperson registration provision of the Securities Act. The Securities Division ordered the Respondents to cease and desist from violating the Securities Act and imposed administrative fines and investigative costs against Smith and Solomon. The Respondents each have the right to request judicial review of the Final Order.


West Coast Commodities - S-18-2466-19-CO01 - Consent Order

On August 13, 2019, the Securities Division entered into a Consent Order with the Respondents, West Coast Commodities LLC and David C. Hamby (“Hamby”). The Securities Division found that the Respondents offered and sold investments totaling at least $575,000 to at least five investors. The Securities Division also found that the Respondents each violated the registration and anti-fraud provisions of the Securities Act of Washington (“Securities Act”). The Securities Division ordered the Respondents to cease and desist from violating the Securities Act and charged $2,500 of investigative costs against Hamby.


Jahshan Gilgeours - S-19-2670-19-FO01 - Final Order

On August 13, 2019, the Securities Division entered a Final Order against Respondent, Jahshan Gilgeours (“Gilgeours”). Gilgeours failed to make a timely hearing request on the initial Statement of Charges. The Final Order finds that Gilgeours offered and sold a $3,500 investment to a Washington investor. Further, the Final Order finds that Gilgeours violated the anti-fraud provision of the Securities Act of Washington by misrepresenting and failing to disclose material information to the investor. The Securities Division ordered Gilgeours to cease and desist from violating the Securities Act of Washington, imposed an administrative fine of $2,500, and charged investigative costs of $1,000. Gilgeours has the right to request judicial review of the Final Order.


Franchise Equity Group - S-19-2705-19-SC01 - Statement of Charges

On August 12, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, to Impose a Fine, and to Charge Costs (“Statement of Charges”) against Maret Manig Casperson (“Manig”), Jerome Leonard Casperson (“Leonard”), Franchise Equity Group, Inc., and Franchise Equity Consortium Group, Inc. (collectively, “Respondents”). The Statement of Charges alleges that Respondents offered and sold securities to a Washington resident between 2013 and 2017 without registering their offering with the Division in violation of the Securities Act of Washington. In connection with the offer and sale of securities, Respondents did not disclose Leonard’s permanent injunction from violating federal securities law for the fraudulent sale of $44.7 million in oil and gas investments from over 1,000 mostly elderly investors or the civil contempt order for failing to pay more than $6.3 million in disgorgement entered against him by a federal district court in the mid-1990s.

Respondent Leonard represented to the Washington resident that he was purchasing shares in an investment group comprised of former employees of a well-known billionaire investor, but did not disclose the names of these employees to allow the resident to confirm their previous employment and the sophistication of the investor group. Respondent Leonard told the Washington resident he could expect unusually high returns for his investment, but did not provide a basis for these returns, and Respondents abruptly ceased communicating and making distributions in 2017.

Respondents Manig and Leonard did not register as securities salespersons or broker-dealers in Washington. The Securities Division intends to order Respondents to cease and desist from violating the Securities Act of Washington and to pay a fine and investigative costs. Respondents each have a right to request a hearing on the Statement of Charges.

A Final Order was entered regarding this matter on October 17, 2019.


Franklin Capital Advisors, LLC and Michael Brustkern - S-19-2708-19-CO01 - Consent Order

On August 12, 2019 the Securities Division entered Consent Order S-19-2713-19-CO01 with Franklin Capital Advisors LLC (CRD 158750) and Michael Brustkern (CRD 5273153) (“Consent Order”). In the Consent Order the parties agreed that Franklin Capital Advisors would withdraw its registration and pay costs of $500. Respondents waived their right to judicial review of the matter.


Mattress by Appointment, LLC - S-17-2143-19-CO01 - Consent Order

On August 5, 2019, the Securities Division entered into a Consent Order with Mattress by Appointment, LLC. In the Consent Order, it is alleged that the Mattress by Appointment violated the Business Opportunity Fraud Act when it offered unregistered business opportunities in Washington in 2016, failed to provide the required disclosures to prospective investors and failed to disclose material information regarding the investment opportunity. Mattress by Appointment agreed to cease and desist from violations of RCW 19.110.050, RCW 19.110.070 and RCW 19.110.120 the registration, disclosure document and unlawful acts sections of Business Opportunity Fraud Act. Mattress by Appointment agreed to pay $5,000 towards the costs of the investigation. The Mattress by Appointment agreed to waive its right to a hearing and judicial review of the matter.


Randall Hayes - S-15-1636-18-CO01 - Consent Order

On August 5, 2019, the Securities Division entered into a consent order with Respondent Randall Hayes.

The Securities Division had previously entered a Statement of Charges against Randall Hayes alleging that that Randall Hayes made unsuitable investment recommendations through the purchase of inverse and leveraged exchange-traded funds in a client account.

In the consent order, Randall Hayes neither admitted, nor denied the order’s Findings of Fact and Conclusions of Law. As part of the consent order, Randall Hayes also agreed to cease and desist from violating the Securities Act of Washington, to pay $7,000 in fines, and to pay $3,000 in costs. Randall Hayes further agreed to voluntarily not apply to register as a securities broker-dealer, securities salesperson, investment adviser, or investment adviser representative in the state of Washington for a period of two years from the entry of the consent order.

Randall Hayes waived his right to a hearing and judicial review of this matter.


Givbux Global Partners, Inc. and Kenyatto M. Jones - S-19-2656-19-CO01 - Consent Order

On August 2, 2019, the Securities Division entered into a Consent Order with Givbux Global Partners, Inc. and Kenyatto Jones (“Respondents”). The Consent Order alleged that the Respondents raised more than $100,000 through the sale of stock to investors in multiple states, including Washington, and failed to disclose material information in violation of the Securities Act. In settling the matter, the Respondents neither admitted nor denied the allegations, but agreed to cease and desist from violating the Securities Act. The Respondents further agreed to pay a fine of $1,000 and reimburse the Securities Division $500 for its costs of investigation. The Respondents waived their right to a hearing and to judicial review of the matter.


Conner and Associates, LLC d.b.a. Franchise Marketing Systems and Christopher James Conner a.k.a. Chris Conner - S-16-2021-19-CO01 - Consent Order

On July 26, 2019, the Securities Division entered into a Consent Order with Conner and Associates, LLC d.b.a. Franchise Marketing Systems and Christopher James Conner a.k.a. Chris Conner (“Respondents”). The Securities Division had previously entered a Statement of Charges against the Respondents on May 10, 2019. The Securities Division alleged that Respondents failed to disclose material facts while offering and selling a RedRhino, Inc. franchise. In addition, the Division alleged that Respondents offered and sold a franchise while not registered as a franchise broker to do so. Without admitting or denying the Securities Division’s allegations, Respondents agreed and were ordered to cease and desist from violating the registration, anti-fraud and franchise broker registration sections of FIPA. Respondents agreed to refrain from offering and selling or assist in the offer and sale of franchises in the state for a period of five years. The Respondents agreed to reimburse the Securities Division $12,000 of its investigation costs. The Respondents waived their right to a hearing and judicial review of the matter.


Overlake Capital, LLC, Overlake Capital Real Estate Fund I, LLLP, Overlake Capital Real Estate Fund II, LLLP, Overlake Capital Absolute Fund I, LLLP, Overlake Capital REO 122, LLC, Overlake Capital REO 123, LLC, Overlake Capital REO 124, LLC, Overlake Capital REO 127, LLC, Overlake Capital REO 128, LLC, Seattle R/E Investments 61, LLC, Beaumont 23, LLC, Caraway Run, LLC, Paradise Harbour, LLC, 817 32nd Ave, LLC, and Paul T. Thacker - S-17-2256-19-CO01 - Consent Order

On July 11, 2019, the Securities Division entered into a Consent Order with Overlake Capital, LLC, Overlake Capital Real Estate Fund I, LLLP, Overlake Capital Real Estate Fund II, LLLP, Overlake Capital Absolute Fund I, LLLP, Overlake Capital REO 122, LLC, Overlake Capital REO 123, LLC, Overlake Capital REO 124, LLC, Overlake Capital REO 127, LLC, Overlake Capital REO 128, LLC, Seattle R/E Investments 61, LLC, Beaumont 23, LLC, Caraway Run, LLC, Paradise Harbour, LLC, 817 32nd Ave, LLC, and Paul T. Thacker (collectively “Respondents”). The Securities Division had previously entered a Statement of Charges and Notice of Intent to Issue an Order to Cease and Desist, Impose Fines, and Charge Costs against the Respondents and Blake E. Robbins. The Statement of Charges alleged that the Respondents raised approximately $7 million dollars from the sale of real estate investments to approximately 28 investors, including approximately 12 Washington residents. The Statement of Charges alleged that the Respondents acted as unregistered broker-dealers and/or securities salespersons, and that the offer and sale of securities by the Respondents violated the anti-fraud provision of the Securities Act of Washington. The Respondents neither admitted nor denied the allegations, but agreed to cease and desist from violating the Securities Act of Washington. The Respondents waived their right to a hearing and to judicial review of the matter.


Ewert, Josef – S-18-2511-19-SC01 - Statement of Charges

On July 10, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, to Impose a Fine, and to Charge Costs (“Statement of Charges”) against Josef Erick Ewert, a/k/a Jay Ellis, a/k/a James Ellis (“Ewert). The Statement of Charges alleges that Ewert offered and sold unregistered investments totaling $16,500 to two investors. Further, the Statement of Charges alleges that Ewert violated the anti-fraud provision of the Securities Act of Washington by failing to disclose material information to investors. The Securities Division intends to order Ewert to cease and desist from violating the Securities Act of Washington, to impose an administrative fine, and to charge investigative costs. Ewert has a right to request a hearing on the Statement of Charges.

A Final Order was entered regarding this matter on September 4, 2019.


Certiplex Corp; Varton Wayne Berian - S-19-2663-19-FO01 - Final Order

On July 8, 2019, the Securities Division entered a Final Order against Certiplex Corporation and Varton Wayne Berian (“Respondents”). The Statement of Charges alleged that Respondents offered candy vending route business opportunities to Washington residents without registering their offering with the Division, in violation of the Washington Business Opportunity Fraud Act. Respondents had the right to request an administrative hearing on the Statement of Charges, but did not make a timely request for such a hearing. The Final Order orders Respondents to cease and desist from violating the Washington Business Opportunity Fraud Act. Respondents each have a right to request judicial review of the Final Order.


Johnson, Richard O’Neill - S-17-2275-19-SC01 - Statement of Charges

On July 3, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, to Deny Future Registrations, to Impose a Fine, and to Charge Costs (Statement of Charges) against Richard O. Johnson II (Johnson), CRD # 854410. In the Statement of Charges, the Securities Division alleges that Johnson violated the Securities Act of Washington by holding himself out as a financial planner, while not registered as such or exempt from such registration in Washington State. The Securities Division further alleges that this conduct violated a Consent Order that the Securities Division and Johnson had previously entered on December 9, 2014 (S-13-1258-14-CO01). Johnson has the right to request a hearing on the Statement of Charges.


My Covenant Love Inc.; Kenneth Renard Smith; Martha Solomon - S-19-2697-19-SC01 - Statement of Charges

On July 3, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, to Impose Fines, and to Charge Costs (“Statement of Charges”) against Respondents, My Covenant Love Inc. (“MCL”), Kenneth Renard Smith (“Smith”), and Martha Solomon (“Solomon”). The Statement of Charges alleges that Respondents offered and sold a total of more than $25,000 worth of investments to at least 10 Washington investors. Further, the Statement of Charges alleges that Respondents each violated the securities registration and anti-fraud provisions of the Securities Act of Washington (“Securities Act”) and that Smith and Solomon each violated the securities salesperson registration provision of the Securities Act. The Securities Division intends to order Respondents to cease and desist from violating the Securities Act and to impose administrative fines and charge investigative costs against Smith and Solomon. The Respondents each have the right to request a hearing on the Statement of Charges.

A Final Order was entered on August 14, 2019.


Tom Puentes - S-18-2554-19-CO01 - Consent Order

On July 2, 2019, the Securities Division entered a Consent Order S-18-2554-19-CO01 with Tom Puentes (CRD 1713812) (“Consent Order”). The Consent Order stated that while on a heightened supervision plan, Mr. Puentes failed to report two emails containing customer complaints to his firm in violation of the firm’s policies and procedures. In the Consent Order the parties agreed that Mr. Puentes would pay a fine of $12,500 and be subject to a heightened supervision plan for at least one year. Respondent waived his right to a hearing and judicial review of the matter.


North America Real Estate Investment Group, Inc.; Haitao Lin a/k/a Hunter Lin - S-18-2483-19-CO01 - Consent Order

On July 2, 2019, the Securities Division of the Washington State Department of Financial Institutions entered into a Consent Order with Respondents North America Real Estate Investment Group, Inc. (“NAREIG”) and its CEO Haitao Lin a/k/a Hunter Lin (“Lin”). The Consent Order resolves a previous Statement of Charges against the Respondents, in which the Securities Division alleged violations of Washington’s Securities Act in connection with the Respondents’ offering of a cryptocurrency called the House Coupon Token. Without admitting or denying the Securities Division’s allegations, the Respondents agreed to cease and desist from violations of RCW 21.20.140, the securities registration provision; RCW 21.20.040, the salesperson and broker-dealer registration provision; and RCW 21.20.010, the anti-fraud provision of the Securities Act. The Respondents agreed to pay a fine of $5,000 and investigative costs of $1,000. The Respondents waived their right to a hearing and judicial review of the matter.


Franklin Capital Advisors LLC and Michael Brustkern - S-19-2708-19-TO01 - Summary Order

On June 21, 2019, the Securities Division entered a Summary Order S-19-2713-19-TO01 summarily suspending the investment adviser registration of Franklin Capital Advisors’ LLC (CRD 158750) and the investment adviser representative registration of Michael Brustkern (CRD 5273153) (“Summary Order”). The Summary Order also gave notice of the intent to revoke the registrations, impose a fine, and charge costs. The Summary Order alleges that Respondents failed to file Franklin Capital Advisors’ year-end balance sheet and its annual updating amendment to its Form ADV. Respondents have a right to judicial review of the matter.

A Consent Order was entered regarding this matter on August 12, 2019.


Philip Bayley; Bayley Financial Inc. - S-19-2605-19-SC01 - Statement of Charges

On June 21, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, Deny Future Registrations, Impose Fines, and Charge Costs (“Statement of Charges”) against Respondents Philip Bayley (CRD #5409291) and Bayley Financial Inc. (IARD #156442).

In the Statement of Charges, the Securities Division alleges that the Respondents violated the suitability requirements of the Securities Act of Washington by (a) failing to collect required information from clients; (b) making unsuitably risky investments in a triple-leveraged inverse exchange-traded fund of mining stocks; (c) concentrating clients entirely in the stock of one mining company; (d) recommending the use of margin trading to purchase additional stock in that company without analyzing whether margin was appropriate for the clients; and (e) recommending that clients convert standard IRAs to Roth IRAs without analyzing information such as their tax status and available liquid funds to cover the substantial resulting tax bills. The Securities Division further alleges that Bayley failed to disclose in writing the material conflict of interest created by his personal ownership of substantial amounts of Tahoe stock. The Statement of Charges gives notice of the Securities Division’s intent to enter an order to cease and desist from violations of the Securities Act of Washington, to impose fines of $100,000, to charge investigative costs of $2,500, and to deny any of the Respondents’ future investment adviser, investment adviser representative, broker-dealer, or securities salesperson applications for registration. The Respondents have the right to request a hearing on the Statement of Charges.

A Consent Order was entered regarding this matter on August 19, 2019.


Park, WinWin Investments - S-18-2450-19-CO01 - Consent Order

On June 19, 2019, the Securities Division entered into a Consent Order with Respondents WinWin Investments, David Sun Park, and Monica Park. The Securities Division had previously entered a Statement of Charges against WinWin Investments, David Sun Park, Monica Park, and Kennety Hwan Kim (“Respondents”). The Statement of Charges alleged that Respondents offered and sold unregistered real estate investments totaling $106,800 to three Washington residents in violation of the registration and anti-fraud provisions of the Securities Act of Washington. Without admitting or denying the allegations, WinWin, Park, and Monica Park agreed to cease and desist from violating the Securities Act. WinWin, Park, and Monica Park each waived their right to a hearing and judicial review of this matter.


Mavada Personal Wealth Management, Inc. and Patrick Ebert - S-19-2700-19-TO01 - Summary Order

On June 6, 2019, the Securities Division entered a Summary Order S-19-2700-19-TO01 summarily suspending the investment adviser registration of Mavada Personal Wealth Management, Inc. (CRD 130750) and the investment adviser representative registration of Patrick Ebert (CRD 2363094) (“Summary Order”). The Summary Order also gave notice of the intent to revoke the registrations, impose a fine, and charge costs. The Summary Order alleges that Respondents failed to file Mavada Personal Wealth Management’s year-end balance sheet. Respondents have a right to judicial review of the matter.


Jahshan Gilgeours - S-19-2670-19-SC01 - Statement of Charges

On June 5, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, to Impose a Fine, and to Charge Costs (“Statement of Charges”) against Respondent, Jahshan Gilgeours (“Gilgeours”). The Statement of Charges alleges that Gilgeours offered and sold a $3,500 investment to a Washington investor. Further, the Statement of Charges alleges that Gilgeours violated the anti-fraud provision of the Securities Act of Washington by misrepresenting and failing to disclose material information to the investor. The Securities Division intends to order Gilgeours to cease and desist from violating the Securities Act of Washington, to impose an administrative fine, and to charge investigative costs. Gilgeours has a right to request a hearing on the Statement of Charges.

A Final Order was entered regarding this matter on August 13, 2019.


Stages Financial LLC and Mark Anders Christiansen - S-19-2684-19-TO01 - Summary Order

On June 3, 2019, the Securities Division entered a Summary Order S-19-2684-19-TO01 summarily suspending the investment adviser registration of Stages Financial LLC (CRD 298286) and the investment adviser representative registration of Mark Anders Christiansen (CRD 5562773) (“Summary Order”). The Summary Order also gave notice of the intent to revoke the registrations, impose a fine, and charge costs. The Summary Order alleges that Respondents failed to file Stages Financial’s year-end balance sheet and its annual updating amendment to its Form ADV. Respondents have a right to judicial review of the matter.


Certiplex Corporation, Varton Wayne Berian – S-19-2663-19-SC01 - Statement of Charges

On June 3, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist (“Statement of Charges”) against Certiplex Corporation and Varton Wayne Berian (“Respondents”). The Statement of Charges alleges that Respondents offered candy vending route business opportunities to Washington residents without registering their offering with the Division in violation of the Washington Business Opportunity Fraud Act. The Securities Division intends to order Respondents to cease and desist from violating the Washington Business Opportunity Fraud Act. Respondents each have a right to request a hearing on the Statement of Charges.

A Final Order was entered regarding this matter on July 8, 2019.


Roger Allan Duval - S-19-2683-19-TO01 - Summary Order

On May 24, 2019, the Securities Division entered a Summary Order to Suspend Registrations and Notice of Intent to Enter an Order to Revoke Registrations, Deny Future Registrations, Impose Fines, and Charge Costs against Roger Allan Duval. The Summary Order alleges that between June 2017 and April 2019, Duval made unauthorized withdrawals totaling $246,400 from three Washington resident brokerage accounts. Duval misappropriated the funds by depositing them into a credit union account under his control. Two of the accounts are held by elderly residents, and one account was owned by a deceased resident, which Duval withdrew funds from soon after the resident’s death in 2017. The Summary Order suspends Duval’s investment adviser representative and securities salesperson registration and gives notice of the Securities Division’s intent to enter an order to revoke Duval’s securities registrations in Washington, to deny future securities registration applications by Duval, and to impose fines and costs. The Respondent has a right to request a hearing on the Summary Order.


Daniel Robert Taylor - S-17-2346-19-CO01 - Consent Order

On May 23, 2019, the Securities Division entered into a consent order with Respondent Daniel Robert Taylor.

The Securities Division had previously entered a Statement of Charges against Daniel Robert Taylor alleging that, through high volume investments at large amounts in inverse and leveraged ETFs in a client account, Daniel Robert Taylor misrepresented the services that he would provide to the client and made unsuitable investments in the client’s account.

In the consent order, Daniel Robert Taylor admitted to the order’s Findings of Fact and Conclusions of Law. As part of the consent order, Daniel Robert Taylor also agreed to cease and desist from violating the Securities Act of Washington, to pay $3,600 in fines, and to have any future securities registrations with the Securities Division denied. Daniel Robert Taylor waived his right to a hearing and judicial review of this matter.


Kennety Hwan Kim – S-18-2450-19-CO02 - Consent Order

On May 22, 2019, the Securities Division entered into a Consent Order with Respondent Kennety Hwan Kim (“Kim”). The Securities Division had previously issued a Statement of Charges against WinWin Investments, David Sun Park, Monica Park, and Kennety Hwan Kim (“Respondents”). The Statement of Charges alleged that Respondents offered and sold real estate investments totaling $106,800 to three Washington residents in violation of the registration and anti-fraud provisions of the Securities Act of Washington. Without admitting or denying the allegations, Kim agreed to cease and desist from violating the Securities Act, and to pay a fine of $2,500. Kim waived his right to a hearing and judicial review of this matter.


Seneca Ventures, LLC - S-18-2430-18-CO01 - Consent Order

On May 14, 2019, the Securities Division entered into a Consent Order with Seneca Ventures, LLC (“Respondent”). According to the allegations, in 2018, the Respondent offered and sold more than $175,000 worth of investments after entering into a Consent Order in October 2017, and failed to disclose material information in violation of the Securities Act. In settling the matter, the Respondent neither admitted nor denied the allegations, but agreed to cease and desist from violating the Securities Act. The Respondent further agreed to pay a fine of $3,000. The Respondent waived its right to a hearing and to judicial review of the matter.


Conner and Associates, LLC d.b.a. Franchise Marketing Systems, Christopher James Conner a.k.a. Chris Conner, RedRhino Group, Inc. a.k.a. RedRhino, Inc., and Michael Kenealy - S-16-2021-19-SC01 - Statement of Charges

On May 10 , 2019, the Securities Division entered a Statement of Charges against Respondents Conner and Associates, LLC d.b.a. Franchise Marketing Systems, Christopher James Conner a.k.a. Chris Conner, RedRhino Group, Inc. a.k.a. RedRhino, Inc., and Michael Kenealy. The Securities Division alleges that each Respondent offered and/or sold unregistered franchises to Washington residents in violation of state franchise law. The Division alleges that each Respondent violated the anti-fraud provisions of the Franchise Investment Protection Act by omitting or failing to disclose material facts to franchisees. The Division further alleges that Respondents Conner and Associates and Christopher James Conner violated the franchise broker registration of the Act by the offering and selling RedRhino franchises in Washington while not registered to do so. The Securities Division intends to order the Respondents to cease and desist from violations of RCW 19.100.020, RCW 19.100.170, and RCW 19.100.140, the franchise registration, anti-fraud, and franchise broker registration sections of the Franchise Investment Protection Act. The Respondents each have an opportunity for hearing in this matter.

A Consent Order as to RedRhino Group, Inc. a.k.a. RedRhino, Inc. and Michael Kenealy was entered on September 16, 2019.

A Consent Order was entered regarding this matter on July 26, 2019.


Daniel Noah Winger - S-18-2538-19-FO01 - Final Order

On May 7, 2019 the Securities Division entered a Final Order against Bonney Lake resident Daniel N. Winger (“Winger”). On April 8, 2019, the Securities Division entered a Statement of Charges against Winger. The Statement of Charges alleged that between April 2015 and April 2018, while registered with the Division as a security salesperson, Winger misappropriated more than $100,000 from an elderly client. The Division further alleged that Winger caused to be filed four Forms U-4 with the Division that were false or misleading. The Statement of Charges gave notice of the Division’s intent to order Winger to cease and desist from filing false or misleading statements with the Division. The Statement of Charges also gave notice of the Division’s intent to charge its investigative costs to Winger, and to impose a fine against him. Finally, the Statement of Charges gave notice of the Division’s intent to deny registrations that Winger may seek in the future. Winger had the right to request an administrative hearing on the Statement of Charges, but he did not make a timely request for such a hearing. The Final Order orders Winger to cease and desist from violating the Washington State Securities Act, and orders that Winger is liable for $1,000 of investigative costs incurred by the Division, and that Winger is liable for, and shall pay a $10,000 fine. The Final Order also orders that any broker-dealer, securities salesperson, investment adviser, and investment adviser representative registrations that Winger may seek shall be denied. Winger may seek judicial review of the Final Order.


Neighborhood Networks Publishing, Inc. d/b/a N2 Publishing - S-18-2456-18-CO01 - Consent Order

On April 22, 2019, the Securities Division entered into a Consent Order with Neighborhood Networks Publishing, Inc. d/b/a N2 Publishing (“Respondent”). The Securities Division had previously entered a Statement of Charges against the Respondent on November 8, 2018. The Securities Division alleged that Respondent violated the Franchise Investment Protection Act (“FIPA”) by offering and selling franchises to at least 30 Washington residents while not registered to do so and by failing to provide them with a franchise disclosure document. The Securities Division also alleged that Respondent made misleading financial performance representations while offering and selling the franchises. Without admitting or denying the Securities Division’s allegations, Respondent agreed to cease and desist from violating the registration, disclosure document, and Violations sections of FIPA. The Respondent agreed to reimburse the Securities Division $4,000 of its investigation costs. The Respondent waived its right to a hearing and judicial review of the matter.


William Derrington - S-17-2276-18-CO01 - Consent Order

On April 18, 2019, the Securities Division entered into a Consent Order with Respondent William Derrington (“Derrington”), CRD #1325480. The Securities Division previously issued a Statement of Charges and Notice of Intent to Enter Order to Revoke Registration, to Deny Future Registrations, to Impose a Fine, and to Charge Costs (“Statement of Charges”) against Derrington.

In the Statement of Charges, the Securities Division alleged that Derrington violated the Securities Act of Washington by engaging in dishonest and unethical business practices, specifically the prohibition on borrowing money from clients. In the Consent Order, without admitting or denying the Securities Division’s allegations, Derrington agreed to cease and desist from engaging in dishonest and unethical practices as defined by RCW 21.20.110(g) and WAC 460-22B-090, and to pay a fine of $500. Derrington further agreed to a revocation of his securities salesperson registration and to the Securities Division’s denial of any of his future investment adviser, investment adviser representative, broker-dealer, or securities salesperson applications for registration. Derrington waived his right to a hearing and to judicial review of this matter.


Thomson Financial Advisors LLC; Lindsay Thomson; and Brendan Shaw - S-17-2258-19-FO01 - Final Order

On April 11, 2019, the Securities Division entered a Final Order to Cease and Desist, To Deny Future Registrations, to Impose Fines, and to Charge Costs against Thomson Financial Advisors LLC, Lindsay Thomson, and Brendan Shaw (collectively, “Respondents”). The Securities Division previously entered a Statement of Charges against the Respondents on March 12, 2019. The Statement of Charges alleged that Respondents violated RCW 21.20.702 and RCW 21.20.020 when they placed a Washington State investor in unsuitable investments related to options trading. Further, the Securities Division alleged that Respondents violated RCW 21.20.020 when they failed to disclose to a Washington State investor the speculative and high-risk nature of their options trading strategy. The Securities Division orders the Respondents to cease and desist from violating the Securities Act of Washington, to deny any future securities registration applications that Respondents may file in the future, and to pay fines and investigative costs. Respondents have the right to request judicial review of this matter.


Winwin Investments – S-18-2450-19-SC01 - Statement of Charges

On April 11, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, to Impose Fines, and to Charge Costs (“Statement of Charges”) against WinWin Investments, David Sun Park, and Kennety Hwan Kim (“Respondents”). The Statement of Charges alleges that Respondents offered and sold real estate investments totaling $106,000 to three Washington residents. Further, the Statement of Charges alleges that Respondents violated the anti-fraud provision of the Securities Act of Washington by failing to disclose material information to investors. The Securities Division intends to order Respondents to cease and desist from violating the Securities Act of Washington, to impose administrative fines, and to charge investigative costs. Respondents each have a right to request a hearing on the Statement of Charges.

A Consent Order was entered regarding this matter on June 19, 2019.

A Consent Order as to Kennety Hwan Kim was entered on May 22, 2019.


Ryan Lee Warriner - S-18-2506-19-CO01 - Consent Order

On April 8, 2019, the Securities Division entered into a Consent Order with Respondent, Ryan Lee Warriner (“Warriner”). The Securities Division alleged that during 2016 Warriner offered and sold two investments totaling $10,000 to two Washington residents. The Securities Division alleged that Warriner violated RCW 21.20.010, the anti-fraud provision of the Securities Act of Washington, in connection with the offer and sale of the investments. Without admitting or denying the allegations, the Respondent agreed to cease and desist from violating RCW 21.20.010 and to pay a $2,000 fine and $500 of investigative costs. The Respondent waived his right to a hearing and to judicial review of this matter.


North America Real Estate Investment Group, Inc.; Haitao Lin a/k/a Hunter Lin - S-18-2483-19-SC01 - Statement of Charges

On April 8, 2019, the Securities Division of the Washington State Department of Financial Institutions entered a Statement of Charges against North America Real Estate Investment Group, Inc. (“NAREIG”) and its CEO Haitao Lin a/k/a Hunter Lin (“Lin”). In the Statement of Charges, the Securities Division alleged that NAREIG and Lin conducted an unregistered securities offering, in the form of a cryptocurrency called the House Coupon Token which was marketed to potential purchasers as an investment. The Securities Division alleged that NAREIG and Lin were not registered to sell securities, and misrepresented or failed to disclose material information in connection with the offering. The Statement of Charges gave notice of the Securities Division’s intent to order Respondents to cease and desist from violating the Securities Act, to impose fines, and to charge the cost of the investigation. The Respondents have the right to request a hearing on the Statement of Charges

A Consent Order was entered regarding this matter on July 2, 2019.


Daniel N. Winger - S-18-2538-19-SC01 - Statement of Charges

On April 8, 2019, the Securities Division entered a Statement of Charges against Bonney Lake resident Daniel N. Winger (“Winger”). The Statement of Charges alleged that between April 2015 and April 2018, while registered with the Division as a security salesperson, Winger misappropriated more than $100,000 from an elderly client. The Division further alleged that Winger caused to be filed four Forms U-4 with the Division that were false or misleading. The Statement of Charges gives notice of the Division’s intent to order Winger to cease and desist from filing false or misleading statements with the Division. The Statement of Charges also gives notice of the Division’s intent to charge its investigative costs to Winger, and to impose a fine against him. Finally,the Statement of Charges gives notice of the Division’s intent to deny any broker-dealer, securities salesperson, investment adviser, and investment adviser registrations that Winger may seek. Winger may request an administrative hearing on the Statement of Charges.

A Final Order was entered regarding this matter on May 7, 2019.


Broad Investments, LLC; Guoyong Liu - S-18-2458-18-CO01 - Consent Order

On April 1, 2019, the Securities Division entered into a Consent Order with Broad Investments, LLC and Guoyong Liu. The Securities Division alleged that the Respondents created a website that offered securities in the form of an initial coin offering (“ICO”). The Securities Division alleged that the Respondents offered unregistered securities, acted as an unregistered broker-dealer and/or securities salesperson, and violated the anti-fraud provision of the Securities Act of Washington. The Respondents neither admitted nor denied the allegations, but agreed to cease and desist from violating the Securities Act of Washington and to pay $1,500 in investigative costs. The Respondents waived their right to a hearing and to judicial review of the matter.


HRC Wealth Management LLC - S-19-2618-19-CO01 - Consent Order

On March 25, 2019, the Securities Division entered into a Consent Order S-19-2618-19-CO01 with HRC Wealth Management LLC (CRD 117212) (“Consent Order”). The Consent Order states HRC Wealth Management employed an unregistered investment adviser representative from August 2, 2016 to February 25, 2019 in violation of RCW 21.20.040(5)(b). The Consent Order includes a $12,000 fine. Respondent waived its right to request judicial review of the matter.


Gordon Bolster Advisors, LLC and Gordon Bolster - S-17-2343-19-CO01 - Consent Order

On March 25, 2019, the Securities Division entered Consent Order S-17-2343-19-CO01 with Gordon Bolster Advisors, LLC (CRD 167875) and Gordon Bolster (CRD 4175826) (“Consent Order”) resolving Statement of Charges and Notice of Intent to Enter an Order to Cease and Desist, Deny Future Registrations, Impose Fines, and Charge Costs S-17-2343-19-SC01. In the Consent Order Respondents agreed to cease and desist from violations of RCW 21.20.040, the securities salesperson and broker-dealer registration section of the Securities Act and RCW 21.20.140, the securities registration section of the Securities Act; that any future broker-dealer or investment adviser registration requests would be denied; that any investment adviser representative and securities salespersons registrations would be denied for a period of 2 years, and that Respondents would pay a fine of $10,000 and costs of $2,500. The Consent Order further stated that the fines and costs are suspended until such time as Respondents apply for registration as an investment adviser, broker-dealer, investment adviser representative, or securities salesperson. Respondents waive their right to a hearing in this matter.


Choice E-Credit LLC - S-18-2540-19-FO01 - Final Order

On March 13, 2019, the Securities Division entered a Final Order against the Respondent, Choice E-Credit LLC (“Choice”). The Securities Division had previously entered a Statement of Charges against Choice, alleging that from May 2018 to October 2018, Choice solicited investments by operating an online lending platform that would supposedly match investors with borrowers. The investments were promoted in the United States and in foreign countries through online videos and social media. The Final Order orders Choice to cease and desist from violating the securities registration and the anti-fraud provisions of the Securities Act of Washington. The Respondent has the right to request judicial review of the Final Order.


Thomson Financial Advisors LLC; Lindsay Thomson; and Brendan Shaw – S-17-2258-19-SC01 - Statement of Charges

On March 12, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, To Deny Future Registrations, to Impose Fines, and to Charge Costs (“Statement of Charges”) against Thomson Financial Advisors LLC, Lindsay Thomson, and Brendan Shaw (collectively, “Respondents”). The Securities Division alleges that Respondents violated RCW 21.20.702 and RCW 21.20.020 when they placed a Washington State investor in unsuitable investments related to options trading. Further, the Securities Division alleges that Respondents violated RCW 21.20.020 when they failed to disclose to a Washington State investor the speculative and high-risk nature of their options trading strategy. The Statement of Charges gives notice to Respondents of the Securities Division’s intent to enter an order to cease and desist from violating the Securities Act of Washington, to deny any future securities registration applications that Respondents may file in the future, to impose fines, and to charge costs. Respondents have a right to request a hearing on the Statement of Charges.

A Final Order was entered regarding this matter on April 11, 2019.


Josh J. Murakami; GoTradeSignals - S-15-1626-16-CO01 - Consent Order

On March 7, 2019, the Securities Division entered into a Consent Order with Josh J. Murakami and GoTradeSignals (collectively “Respondents”). The Securities Division had previously entered a Statement of Charges and Notice of Intent to Issue an Order to Cease and Desist, Impose Fines, and Charge Costs against the Respondents. The Statement of Charges alleged that the Respondents disseminated a subscription-based newsletter with specific options trading instructions to investors with auto-traded accounts. The Statement of Charges further alleged that Murakami failed to fully disclose his history of prior enforcement actions to all newsletter subscribers. The Statement of Charges alleged that the Respondents acted as an unregistered investment adviser and investment adviser representative and violated the investment adviser anti-fraud provision of the Securities Act of Washington. The Respondents neither admitted nor denied the allegations, but agreed to cease and desist from violating the Securities Act of Washington and to pay $3,000 in investigative costs. The Respondents waived their right to a hearing and to judicial review of the matter.


LPL Financial LLC – S-18-2474-18-CO01 - Consent Order

On March 4, 2019, the Securities Division entered a Consent Order with LPL Financial LLC (“LPL Financial”). In connection with an investigation conducted by a multi-state task force coordinated among members of the North American Securities Administrators Association, the Securities Division alleged that from 2006 to 2018, LPL Financial offered and sold unregistered, non-exempt securities in violation of RCW 21.20.140; failed to reasonably supervise its agents, staff, and employees to prevent the sale of unregistered, non-exempt securities; and failed to maintain books and records necessary to ensure full and proper compliance with state securities laws, rules, and regulations in violation of RCW 21.20.100. LPL Financial has agreed to make customer remediation, perform a comprehensive review of its policies and procedures, and authorize the Securities Division to conduct audits, inspections, or examinations of LPL Financial to ensure compliance with this order. LPL Financial neither admitted nor denied the allegations, but agreed to cease and desist from violations of RCW 21.20.140 and 21.20.100. LPL Financial agreed to pay a fine of $499,000. LPL Financial waived its right to a hearing and to judicial review of the matter.


KDJ HOLDINGS, LLC f.k.a. BigShots Golf and Jason E Payne - S-18-2570-19-CO01 - Consent Order

On February 27, 2019, the Securities Division entered into a Consent Order with KDJ HOLDINGS, LLC f.k.a. BigShots Golf and Jason E. Payne (the “Respondents”). In the Consent Order, it is alleged that the Respondents violated the Franchise Investment Protection Act by offering unregistered franchises in Washington in 2017 and failing to provide a franchisee a franchise disclosure document with material facts about the offering. The Respondents have agreed to cease and desist from violations of RCW 19.100.020 and RCW 19.100.080, the registration and disclosure document sections of the Franchise Investment Protection Act. Respondents agreed to pay $1,700 towards the costs of the investigation. The Respondents agreed to waive their right to a hearing and judicial review of the matter.


WebRotator, Inc.; Scott Wilkerson – S-17-2138-18-SC01 - Statement of Charges

On February 22, 2019, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, to Impose a Fine, and to Charge Costs (“Statement of Charges”) against WebRotator, Inc. and Scott B. Wilkerson (“Respondents”). Previously, in August 2016, the Securities Division entered into a Consent Order with Respondents to settle earlier allegations by the Securities Division that Respondents violated registration and anti-fraud provisions of the Securities Act of Washington. In the 2016 Consent Order, Respondents were ordered and agreed to cease and desist from violations of the Securities Act. The current Statement of Charges alleges that Respondents offered and sold approximately $167,500 of investments in WebRotator, Inc. to ten investors in violation of the 2016 Consent Order and the Securities Act of Washington. Further, the Statement of Charges alleges that Respondents violated the anti-fraud provision of the Securities Act of Washington by failing to disclose material information to investors. The Securities Division intends to order Respondents to cease and desist from violating the Securities Act of Washington, to impose an administrative fine, and to charge investigative costs. Respondents each have a right to request a hearing on the Statement of Charges.

A Final Order was entered regarding this matter on September 27, 2019.


Best Western – S-18-2510-19-CO01 -Consent Order

On February 21, 2019, the Securities Division entered into a Consent Order with Best Western International, Inc. (the “Respondent”). In the Consent Order, it is alleged that the Respondent violated the Franchise Investment Protection Act by offering unregistered franchises in Washington and failed to provide franchisees a franchise disclosure document with material facts about the offering. The Respondent agreed to cease and desist from violations of RCW 19.100.020 and RCW 19.100.080, the registration and disclosure document sections of the Franchise Investment Protection Act. The Respondent agreed to pay $3,000 towards the costs of the investigation. The Respondent agreed to waive its right to a hearing and judicial review of the matter.


Brainchild Brands, LLC and Vincent P. Blumetti a.k.a. Vince Blumetti - S-18-2465-19-CO01 - Consent Order

On February 8, 2019, the Securities Division entered into a Consent Order with Brainchild Brands, LLC and Vincent P. Blumetti a.k.a. Vince Blumetti (the “Respondents”) of Chamblee, Georgia. In the Order, it is alleged that the Respondents violated the Franchise Investment Protection Act by offering franchises in Washington while not registered as a franchise broker. Without admitting or denying the allegations, the Respondents have agreed to cease and desist from violations of RCW 19.100.140, the franchise broker registration section of the Franchise Investment Protection Act. The Respondents agreed to reimburse the Securities Division its investigative costs of $3,100. The Respondents agreed to waive their right to a hearing and judicial review of the matter.


InfoScape Corporation - S-17-2185-18-CO02 - Consent Order

On February 5, 2019, the Securities Division entered into a Consent Order with InfoScape Corporation. The Securities Division had previously entered a Statement of Charges and Notice of Intent to Issue an Order to Cease and Desist, Impose Fines, and Charge Costs against InfoScape Corporation and Gregory D. Mrachek. The Statement of Charges alleged that the Respondents raised over $650,000 from selling a fourth series of convertible promissory notes, including to at least 12 Washington residents. The Statement of Charges further alleged that Respondent Mrachek acted as an unregistered broker-dealer and/or securities salesperson, and that the offer and sale of securities by the Respondents violated the anti-fraud provision of the Securities Act of Washington. InfoScape Corporation neither admitted nor denied the allegations, but agreed to cease and desist from violating the Securities Act of Washington. InfoScape Corporation waived its right to a hearing and to judicial review of the matter.


Shaun Brog; Ryan Brog; Kenyon Capital Investment Holdings LLC - S-17-2137-18-CO01 - Consent Order

On January 30, 2019, the Securities Division entered into a Consent Order with Respondents Shaun Brog (CRD #5000205), Ryan Brog (CRD #5798126), and Kenyon Capital Investment Holdings LLC (“Kenyon Capital”). The Securities Division had previously entered a Statement of Charges against Shaun Brog, Ryan Brog, and Kenyon Capital. In the Statement of Charges, the Securities Division alleges that Shaun Brog, Ryan Brog, and Kenyon Capital (collectively “the Respondents”) violated the Securities Act of Washington and accompanying regulations in the course of the offer and sale of interests in Kenyon Capital, and subsequently in the administration of Kenyon Capital. Without admitting or denying the Securities Division’s allegations, Shaun Brog, Ryan Brog, and Kenyon Capital agreed to cease and desist from violating the Securities Act, and to pay a fine of $20,000 and investigative costs of $5,000. Shaun Brog, Ryan Brog, and Kenyon Capital waived their rights to a hearing and to judicial review of this matter.


Zoned In Marketing Group, Inc. d.b.a. Franchise Sales Force and Anthony G. Bonnani - S-18-2477-19-CO01 - Consent Order

On January 29, 2019, the Securities Division entered into a Consent Order with Zoned In Marketing Group, Inc. d.b.a. Franchise Sales Force and Anthony G. Bonnani (the “Respondents”) of Mt. Clemens, Michigan. In the Order, it is alleged that the Respondents violated the Franchise Investment Protection Act by offering franchises in Washington while not registered as a franchise broker. Without admitting or denying the allegations, the Respondents have agreed to cease and desist from violations of RCW 19.100.140, the franchise broker registration section of the Franchise Investment Protection Act. The Respondents agreed to reimburse the Securities Division its investigative costs of $2,000. The Respondents agreed to waive their right to a hearing and judicial review of the matter.


AlderEgo Holdings, Inc.; Carfield Family, Inc. d/b/a AlderEgo Wholesale; Jonathan R. Carfield - S-17-2257-19-FO01 - Final Order

On January 17, 2019, the Securities Division entered a Final Order to Cease and Desist, Impose Fines, and Charge Costs against AlderEgo Holdings, Inc., Carfield Family, Inc. d/b/a AlderEgo Wholesale, and Jonathan R. Carfield (collectively “Respondents”). The Securities Division previously entered a Statement of Charges against the Respondents on October 3, 2018. The Statement of Charges alleged that Respondent Carfield raised over $150,000 from selling a promissory note and stock in his marijuana businesses to five investors, including four Washington residents. The Statement of Charges further alleged that Respondent Carfield acted as an unregistered broker-dealer and/or securities salesperson, and that the offer and sale of securities by the Respondents violated the anti-fraud provision of the Securities Act of Washington. The Securities Division orders the Respondents to cease and desist from violating the Securities Act of Washington, and to pay fines and investigative costs. The Respondents have the right to request judicial review of this matter.


DetailXperts Franchise Systems LLC - S-18-2563-18-CO01 - Consent Order

On January 8, 2019, the Securities Division entered a Consent Order with DetailXperts Franchise Systems LLC (the “Respondent”). The Securities Division alleged that in February 2018, the Respondent violated the Franchise Investment Protection Act when it offered and sold an unregistered franchise in Washington State. The Respondent neither admitted nor denied the allegation, but agreed to cease and desist from violations of RCW 19.100.020, the registration section of the Franchise Investment Protection Act. Respondent agreed to pay $250 towards the costs of the investigation. The Respondent waived its right to a hearing and to judicial review of the matter.