Sept 12 Direct Markets Holdings Corp
said its broker-dealer unit informed the Financial Industry
Regulatory Authority that the unit was no longer in compliance
with regulatory capital rules and would cease conducting its
The unit, Rodman and Renshaw LLC, would conduct only
liquidating transactions till it regained compliance with the
U.S. Securities and Exchange Commissions net capital rules, the
company said in a regulatory filing.
The unit was exploring options, including terminating its
broker-dealer license and sale of assets to an entity controlled
by its founder Michael Vasinkevich.
The firm had said last month that it had experienced an
increase in the scope and amount of information requested by the
FINRA related to the various aspects of its broker-dealer
Direct Markets was previously Rodman and Renshaw Capital
Group Inc, a small investment bank. It changed its name in May
to focus on developing financial technology applications and
operating the DirectMarkets platform.
The company said it believed the new focus on technology
would generate more value than its legacy investment
Rodman and Renshaw was fined $315,000 in August by FINRA for
supervisory and other violations after the regulator found that
the firm's research analysts were soliciting investment banking
Direct Markets had said in August its unit had net capital
of $2.2 million, more than its required net capital of $1.0
million, as of June 30.
Direct Markets shares closed at $0.14 on the Nasdaq on