FINRA Seeks Order Against Oil and Gas "Boiler Room" in San Antonio
Last Friday, FINRA announced that it was seeking a Temporary Cease and
Desist Order against San Antonio-based Pinnacle Partners Financial Corporation
and its president, Brian K. Alfaro, for allegedly operating a "boiler
room," according to a Dec. 3 Securities Technology Monitor article
by Tom Steinert-Threlkeld.
A "boiler room" is a place in which stockbrokers and salespeople call potential investors and use high-pressure and misleading sales tactics to persuade them to invest in speculative (and sometimes fraudulent) securities products. FINRA alleges that the San Antonio company and Alfaro have operated a boiler room since 2008 and use it to raise money for eight unregistered private placements in oil and gas that Alfaro runs.
As quoted in the article, FINRA said it is seeking the Order to prevent "customer harm and depletion of customer assets" which it believes "will likely continue before a formal disciplinary proceeding against Pinnacle and Alfaro can be completed."
The Texas State Securities Board issued an emergency cease-and-desist order against Alfaro and Pinnacle last September. The SEC is now conducting its own investigation as well.