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Securities Commissioner Enters Disciplinary Order Fining Waxahachie Investment Company

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Legacy Wealth Advisors, Inc., a Texas registered investment adviser located in Waxahachie, Texas, consented to the entry of a Disciplinary Order that will require Legacy Wealth Advisors to pay an administrative fine of $15,000. The Disciplinary Order was entered today by the Securities Commissioner, Travis J. Iles.

The staff of the Texas State Securities Board conducts regular inspections of licensed investment advisers. During the inspection of Legacy Wealth Advisors, the staff found that Legacy Wealth Advisor’s registration with the Securities Commissioner had lapsed on two different occasions — 2019 and 2020 – for failure to timely pay annual renewal fees. In fact, Legacy Wealth Advisor was unlicensed for the entirety of 2020. Additionally, Legacy Wealth Advisors failed to timely renew the registrations of two investment adviser representatives. One of these remained unlicensed at the time of the inspection. Yet both Legacy Wealth Advisors and the two representatives had provided investment advice to their clients during this unregistered period. The Disciplinary Order sanctioned Legacy Wealth Advisors for providing investment advice in Texas while not registered with the Securities Commissioner.

During the inspection, the staff also found that Legacy Wealth Advisors had not developed written supervisory procedures relating to its activities as an investment adviser. Board Rule 116.10 requires investment advisers to do so, in order to prevent violations of applicable securities laws, such as failing to annually renew registrations. Legacy Wealth Advisors has agreed, as part of the Disciplinary Order, to retain an independent compliance consultant that will conduct a review of Legacy Wealth Advisor’s business activities as an investment adviser and assist the firm with developing written supervisory procedures and addressing other issues identified by the staff during the inspection.

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Author: Faith Huffman

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