The U.S. Securities & Exchange Commission announced a settlement with Paul John McCabe Jr. and PMAC Consulting LLC over charges that they acted as unregistered brokers in transactions involving shares of private companies expected to undertake initial public offerings. The respondents agreed to pay USD 3 million to resolve the matter. According to the SEC’s order, McCabe continued broker activity after consenting to a permanent bar from broker activity by the Financial Industry Regulatory Authority in late 2016, including negotiating transaction terms for pre-IPO shares, working directly with issuers, providing advice or valuations to purchasers, and serving as the primary intermediary between buyers and sellers. The order states that McCabe received more than USD 16 million in transaction-based compensation through PMAC on behalf of several fund clients and nearly 100 sellers, and finds violations of the broker-dealer registration provisions of federal securities laws. Without admitting or denying the findings, McCabe and PMAC agreed to industry and penny stock bars, joint and several civil penalties of USD 3 million, and a cease-and-desist order.
U.S. Securities & Exchange Commission 2025-01-17
U.S. Securities & Exchange Commission charges Paul McCabe and PMAC Consulting with unregistered brokering of pre-IPO share transactions
The U.S. Securities & Exchange Commission settled with Paul John McCabe Jr. and PMAC Consulting LLC for acting as unregistered brokers in pre-IPO transactions, resulting in a USD 3 million penalty. McCabe violated a prior broker activity bar by engaging in transactions and receiving over USD 16 million in compensation. The settlement includes industry and penny stock bars and a cease-and-desist order.