Ingalls Investment Management, Llc

Allegations: THE STIPULATION OF FACTS AND CONSENT TO PENALTY WAS SUBMITTED FOR THE SOLE PURPOSE OF SETTLING THIS DISCIPLINARY PROCEEDING, WITHOUT ADJUDICATION OF ANY ISSUES OF LAW OR FACT, AND WITHOUT ADMITTING OR DENYING ANY ALLEGATIONS OR FINDINGS REFERRED TO THEREIN. THE FIRM, DURING THE REVIEW PERIOD, MISMARKED AS "CUSTOMER" INSTEAD OF "FIRM" APPROXIMATELY 156 OPTIONS ORDERS, REPRESENTING APPROXIMATELY 5,345 OPTIONS CONTRACTS, A SIGNIFICANT PORTION OF WHICH WERE EXECUTED ON THE EXCHANGE, FOR PERSONAL ACCOUNTS OF CERTAIN MANAGING DIRECTORS OF THE FIRM. THE MISMARKINGS RESULTED FROM THE FIRM'S TRADERS ENTERING THE WRONG ORIGIN CODE WHEN ROUTING THE SUBJECT ORDERS FOR EXECUTION. THE FOREGOING MISMARKINGS, AMONG OTHER THINGS, ADVERSELY IMPACTED NYSE MKT'S ABILITY TO SURVEIL FOR AND DETECT POTENTIAL VIOLATIONS OF ITS RULES AND THE FEDERAL SECURITIES LAWS. THE CONDUCT DESCRIBED VIOLATED EXCHANGE RULES 16, 324, AND 956NY; SECTION 17(A) OF THE SECURITIES EXCHANGE ACT OF 1934 ("EXCHANGE ACT"); AND EXCHANGE ACT RULE 17A-3. THE FIRM, DURING THE REVIEW PERIOD, FAILED TO ESTABLISH, MAINTAIN, ENFORCE, AND KEEP CURRENT A SYSTEM OF COMPLIANCE AND SUPERVISORY CONTROLS, REASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITH APPLICABLE SECURITIES LAWS AND EXCHANGE RULES REGARDING ORIGIN CODE REQUIREMENTS WITH RESPECT TO ORDERS ENTERED ON BEHALF OF ITS MANAGING DIRECTORS. THE CONDUCT DESCRIBED VIOLATED EXCHANGE RULE 320. Status: Final Sanction Detail: THE FIRM WAS CENSURED AND FINED $22,500. Summary: PAYMENT PURSUANT TO THE AWC HAS BEEN SENT.

Allegations: AN ACCEPTANCE, WAIVER AND CONSENT ("AWC") WAS ENTERED INTO FOR THE SOLE PURPOSE OF SETTLING A DISCIPLINARY PROCEEDING, WITHOUT ADMITTING OR DENYING THE ALLEGATIONS. THE ALLEGATIONS AGAINST THE FIRM WERE: (1) DURING THE REVIEW PERIOD BETWEEN APRIL 2009 AND AUGUST 2012, THE FIRM FAILED TO REPORT APPROXIMATELY 7,251 REPORTABLE POSITIONS BECAUSE THEY HAD BEEN AGGREGATED BY SERIES RATHER THAN UNDERLYING SECURITY AND SIDE OF THE MARKET; (2) DURING THE REVIEW PERIOD, BETWEEN JULY 2005 AND SEPTEMBER 2012, THE FIRM FAILED TO ACCURATELY REPORT CERTAIN REPORTABLE POSITIONS BECAUSE ACCOUNTS OVER WHICH THE FIRM HAD DISCRETION WERE REPORTED ON AN OMNIBUS BASIS RATHER THAN ON AN INDIVIDUAL BASIS; AND (3) BETWEEN JANUARY 2010 AND JUNE 2013, THE FIRM MISREPORTED APPROXIMATELY 3,075 POSITIONS TO LOPR AS A RESULT OF ITS INCORRECT POPULATION OF DATA IN THE ACCOUNT NAME, ACCOUNT ADDRESS, OR TAX IDENTIFICATION FIELDS. ALL OF THE AFOREMENTIONED INCIDENTS WERE IN VIOLATION OF ISE RULE 415(A). IN ADDITION, DURING THE REVIEW PERIOD, INGS FAILED TO MAINTAIN ADEQUATE SUPERVISORY SYSTEMS AND CONTROLS IN PLACE, INCLUDING ADEQUATE WRITTEN SUPERVISORY PROCEDURES REASONABLE DESIGNED TO ACHIEVE ACCURATE REPORTING OF REPORTABLE OPTIONS POSITIONS TO LOPR IN VIOLATION OF ISE RULE 401. Status: Final Sanction Detail: THE FIRM WAS CENSURED AND FINED $175,000.00 Summary: FINAL PAYMENT PURSUANT TO THE AWC HAS BEEN SENT.

Allegations: THE VIRGINIA SECURITIES ACT (THE "ACT") REQUIRES ALL THIRD-PARTY SOLICITORS OF POTENTIAL INVESTMENT ADVISORY CLIENTS TO BE REGISTERED AS AN INVESTMENT ADVISOR REPRESENTATIVE REGARDLESS OF WHETHER THE ACTIVITY IS LIMITED TO SOLICITATION ACTIVITIES RATHER THAN RENDERING OF INVESTMENT ADVICE. VIRGINIA ALLEGED THAT BETWEEN DECEMBER 2021 AND MARCH 2023, I&S VIOLATED § 13.1-504 OF THE ACT WHEN RETAINED A THIRD-PARTY INDEPENDENT CONTRACTOR ("SOLICITOR"), AN UNREGISTERED INVESTMENT ADVISOR REPRESENTATIVE WITH A PLACE OF BUSINESS IN THE COMMONWEALTH, TO SOLICIT AND REFER CLIENTS TO I&S FOR DISCRETIONARY, FEE-BASED MANAGED ACCOUNTS. Status: Final Sanction Detail: THE MATTER WAS SETTLED FOR $6,000. $5,000 OF THE AMOUNT WAS A FINE. AN ADDITIONAL $1,000 WAS PAID TO REIMBURSE THE VIRGINIA FOR THE COSTS INCURRED BY THE STATE IN CONNECTION WITH THIS MATTER. Summary: THE FINE WAS PAID AND THE MATTER HAS BEEN DISMISSED.

Allegations: NASD RULES 2110, 3010, 6955(A) - INGALLS & SNYDER, LLC FAILED TO TRANSMIT ALL OF ITS REPORTABLE ORDER EVENTS (ROES) TO THE ORDER AUDIT TRAIL SYSTEM (OATS) ON NUMEROUS BUSINESS DAYS. THE FIRM FAILED TO PROVIDE DOCUMENTARY EVIDENCE THAT IT PERFORMED THE SUPERVISORY REVIEWS SET FORTH IN ITS WRITTEN SUPERVISORY PROCEDURES CONCERNING OATS. Status: Final Sanction Detail: WITHOUT ADMITTING OR DENYING THE FINDINGS, INGALLS & SNYDER LLC CONSENTED TO A FINE OF $20,000.00 AND A CENSURE. Summary: INGALLS & SNYDER LLC SUBMITTED A LETTER OF ACCEPTANCE WAIVER AND CONSENT IN WHICH, WITHOUT ADMITTING OR DENING THE FINDINGS, IT CONSENTED TO FINDINGS THAT IT FAILED TO TRANSMIT ALL OF ITS REPORTABLE ORDER EVENTS TO THE ORDER AUDIT TRAIL SYSTEM ON NUMEROUS BUSINESS DAYS. THE FIRM FAILED TO PROVIDE DOCUMENTARY EVIDENCE THAT IT PERFORMED THE SUPERVISORY REVIEWS SET FORTH IN ITS WRITTEN SUPERVISORY PROCEDURES CONCERNING OATS. WITHOUT ADMITTING OR DENYING THE FINDINGS, INGALLS & SNYDER LLC CONSENTED TO THE FOLLOWING SANCTIONS: A CENSURE AND A FINE OF $20,000.00 (COMPOSED OF A $15,000.00 FINE FOR THE OATS MATTER AND A $5000.00 FINE FOR THE SUPERVISION MATTER).THE LETTER OF ACCEPTANCE WAIVER AND CONSENT WAS ACCEPTED BY FINRA ON JULY 28, 2010.