Ae Wealth Management, Llc

Allegations: THE COMMISSION ALLEGED THAT CORNERSTONE WEALTH MANAGEMENT, NATHANIEL BARNHART, LISA BARNHART, AE WEALTH MANAGEMENT, LLC, DAVID CALLANAN, CHRISTOPHER COX, BETH COX, WILLIAM ANDY SMITH, KIMBERLY SMITH AND SMITH & COX, LLC ("RESPONDENTS"), VIOLATED THE ARIZONA SECURITIES ACT BY FAILING TO DISCLOSE A 2006 UNPAID JUDGMENT OWED BY WILLIAM ANDY SMITH, 2013, 2016 AND 2017 IRS TAX LIENS AGAINST WILLIAM ANDY SMITH FOR UNPAID TAXES, A 2018 ENFORCEMENT ACTION BY THE COMMISSION AGAINST SMITH & COX AND OTHERS AND A 2020 ENFORCEMENT ACTION BY THE COMMISSION AGAINST THE RESPONDENTS. THE COMMISSION ALSO ALLEGED THAT THE RESPONDENTS FAILED TO DISCLOSE THAT AE WEALTH MANAGEMENT TERMINATED ITS CO-ADVISORY RELATIONSHIP WITH SMITH & COX BECAUSE SMITH & COX WITHHELD NEGATIVE MATERIAL INFORMATION FROM AE WEALTH MANAGEMENT. THE COMMISSION FURTHER ALLEGED THAT CHRISTOPHER COX, WILLIAM ANDY SMITH, AND AE WEALTH MANAGEMENT WERE LIABLE AS CONTROL PERSONS FOR VIOLATIONS BY SMITH & COX, CALLANAN WAS LIABLE AS A CONTROL PERSON FOR VIOLATIONS BY AE WEALTH MANAGEMENT, AND NATHANIEL BARNHART, CHRISTOPHER COX, AND WILLIAM ANDY SMITH WERE LIABLE AS CONTROL PERSON FOR VIOLATIONS BY CORNERSTONE. Status: Final Sanction Detail: RESTITUTION IN THE PRINCIPAL AMOUNT OF $1,159,400.97. ENTIRE PORTION LEVIED AGAINST AE WEALTH MANAGEMENT AND WAS PAID ON 9/9/2021. ADMINISTRATIVE PENALTY IN THE AMOUNT OF $150,000. ENTIRE PORTION LEVIED AGAINST AE WEALTH MANAGEMENT WAS WAS PAID ON 9/3/2021. Summary: ON SEPTEMEBER 1, 2021, THE FIRM ENTERED INTO A CONSENT ORDER WITH THE COMMISSION AND AGREED TO PAY AN ADMINISTRATIVE PENALTY AND RESTITUTION OF INVESTMENT ADVISORY FEES TO SMITH AND COX'S CO-ADVISORY CLIENTS. IN CONNECTION WITH THE CONSENT ORDER, CALLANAN WAS DISMISSED FROM THE PROCEEDING.