Andrew Garrett, Inc.

Allegations: ANDREW GARRETT, INC EMPLOYED AN UNREGISTERED AGWENT , FAILED TO PROMPTLY NOTIFY THE MO COMM . WHEN THE AGENT BEGAN AND TERMINATED HIS CONNECTION WITH AGI AND FAILED TO REASONABLY SUPERVISE THE AGENT BY ESTABLISHING PROCEDURES AND A SYSTEM FROM APPLYING SUCH PROCEDURS THAT WOULD REASABLY BE EXPECTED TO PREVENT AND DETECT IN SO FAR AS PRACTIBLE ANY VIOLATIONS BY ITS AGENTS Status: Final Sanction Detail: AGI IS PROHIBITED FROM EMPLOYING AGENTS UNLESS REGISTERED OR EXEMPT, FAILING TO PROMPTLY AND TIMELY NOTIFY THE COMM WHEN AN AGENT BEGINS OR TERMINATES CONNECTION WITH THE FIRM, AND FAILING TO REASONBLY SUPERVISE AGENT : AGI WILL SUBMIT SUPERVISORY AND COMPLIANCE PROCEDURES THAT MEET OR EXCEED THE DIV. REQUIREMENTS : WILL PAY 5000.00 IN CIV PENALY AND 4500 TO THE INVESTOR EDUCATION AND PROTECTION FUND Summary: SEE 12-B

Allegations: IN DECEMBER 1995 AND JANUARY 1996, MDBI EXECUTED SEVEN SHORT SALES TRANSACTIONS AND FAILED TO REPORT EACH OF THOSE TRADES TO ACT WITH A SHORT SALE INDICATOR. Status: Final Sanction Detail: $700 FINE Summary: IN DECEMBER 1995 AND JANUARY 1996, MDBI EXECUTED SEVEN SHORT SALES TRANSACTIONS AND FAILED TO REPORT EACH OF THOSE TRADES TO ACT WITH A SHORT SALE INDICATOR. IN JUNE OF 97 MDBI RECEIVED A WAIVER AND CONSENT.

Allegations: ANDREW GARRETT HAS FAILED TO COMPLY WITH THE TERMS OF AGENT SUPERVISORY AGREEMENTS. ANDREW GARRETT FAILED TO REASONABLY SUPRVISE AGENTS Status: Final Sanction Detail: 50000.00 PAID 02/04/2013 Summary: "THE SETTLEMENT WITH THE NEW JERSEY BUREAU OF SECURITIES RELATED TO THE APPORTIONMENT OF COMMISSIONS IN THE AMOUNT OF $18,238.95 TO TWO BROKERS. THE CONSENT ORDER DOES NOT ASSERT INVESTOR LOSS OR HARM. ANDREW GARRETT CHARGED BACK THE ENTIRE AMOUNT OF COMMISSIONS FROM THE BROKERS, AND WITHHELD CERTAIN COMMISSIONS EVEN BEFORE THE NEW JERSEY BUREAU OF SECURITIES PROPOSED CONSENT ORDERS RELATING TO THE COMMISSIONS. ANDREW GARRETT HAS MADE CERTAIN CHANGES TO ITS SUPERVISORY AND COMPLIANCE PROCEDURES. THE FIRM SETTLED THE MATTER TO AVOID THE EXPENSE AND DELAY THAT FORMAL ADMINISTRATIVE PROCEEDINGS WOULD INVOLVE. THE FIRM'S FULL COOPERATION WITH THE NEW JERSEY BUREAU OF SECURITIES IS ACKNOWLEDGED IN THE CONSENT ORDER."

Allegations: ON 10/5/2010 THE CT BANKING COMMISSIONER ENTERED A CONSENT ORDER WITH RESPECT TO ANDREW GARRETT, INC. THE CONSENT ORDER ALLEGED THAT FROM AT LEAST 09/2008 THROUGH 07/2009, THE FIRM FAILED TO ESTABLISH AND MAITAINAN ADEQUATE SUPERVISORY SYSTEM AND THAT AS A RESULT THE FIRM ALLOW ITS SECURITIES REPS TO SPLIT COMMISSIONS EARNED FROM CT. TRADING ACTIVITY WITH AN UNREGISTERED FIRM REP WHO HAD BEEN THE SUBJECT OF A 2008 CONSENT ORDER ENTERED BY THE COMMISSIONER BARRING HIM FROM TRANSACTING SECURITIES BUSINESS AS AN AGENT IN CONNECTICUT FOR SEVEN YRS Status: Final Sanction Detail: SEE ITEM 12-B Summary: SEE ITEM 12-B

Allegations: ANDREW GARRETT THROUGH ITS REGISTERED RIA TRASACTED BUSINESS IN THE STATE OF MO WITHOUT BEING REGISTERED Status: Final Sanction Detail: AGI WILL RETAIN AT ITS EXPENSE AN OUTSIDE CONSULTANT TO REVIEW MAKE RECOMENDATIOSN AND MONITOR COMPLIANCE POLICES AND PRACTICES Summary: AGI WILL RETAIN AT ITS EXPENSE AN OUTSIDE CONSULTANT TO REVIEW MAKE RECOMENDATIOSN AND MONITOR COMPLIANCE POLICES AND PRACTICES

Allegations: ANDREW GARRETT, INC FAILED TO COMPLY WITH THE TERMS OF A HEIGHTED SUPERVISION AGREEMENT Status: On Appeal Sanction Detail: THE BUREAU APPROVED AN AGENT REG. WITH ANDREW GARRETT, INC ON 05/01/2009CONTIGENT UPON A HEIGHTED SUPERVISON. PER TERMS OF THE AGREEMENT ANDREW GARRETT FAILED TO NOTIFY THE BUREAU OF AT LEAST FOUR ACTIONS THAT WERE REPORTABLE TO THE BUREAU, INCLUDING A SUSPENSION AND REVOCATION, ANDREW GARRETT FAILED TO NOTIFY THE BUREAU OF A CHANGE OF SUPERVISORY PERSONELL FOR THE AGENT. ANDREW GARRETT, INC FAILED TO CONDUCT MONTHLY REVIEWS OF THE AGENTS SECURITIES ACTIVITY THE AGREEMENT STATES THAT FAILURE TO COMPLY W/ AGREEMENT SHALL BE DEEMED TO BE A VIOLATION OF NJAC 1347-16 WHIXH ENTITLES THE BUREAU TO IMPOSE SANCTIONS Summary: SEE 12-C

Allegations: PENALITY OF $5500.00 FOR LATE FILED AUDITTED STATEMENT FOR YOEAR 2001 WAS NOT PAID Status: Final Sanction Detail: DEFAULT ORDER ENTERED. REVOCATION, ADMINISTRATIVE FINE OF 2500.00 AND BACK PENALITES OF 5500.00 Summary: RESPONDENT FAILED TO PAY BACK PENALITY OF 5550.00 FOR LATE FILING OF YEAR 2000 AUDITED FINACIAL STATEMENT 03/02/2006 THE PRIOR DEFAULT ORDER WAS VACATED. THE REPOSNDENT PAID THE PENALTY AND FINE DUE. THE RESPONDENT MAY REAPPLY FOR LICENSURE.

Allegations: SEC RULES 15C3-1, 17A-3(11), 17A-5, NASD RULES 2110,3110(A)- RESPONDENT MEMBER, ACTING THROUGH AN INDIVIDUAL, USED THE MEANS OR OTHER MEANS OR INSTRUMENTALITIES OF INTERSTATE COMMERCE TO EFFECT TRANSACTIONS IN SECURITIES WHEN IT FAILED TO MAINTAIN THE MINIMUM REQUIRED NET CAPITAL; ACTING THROUGH AN INDIVIDUAL, PREPARED AN INACCURATE TRIAL BALANCE AND NET CAPITAL COMPUTATION; AND ACTING THROUGH AN INDIVIDUAL, FILED WITH NASD A FOCUS PART IIA REPORT THAT WAS INACCURATE IN THAT, AMONG OTHER THINGS, IT OVERSTATED THE FIRM'S NET CAPITAL. Status: Final Sanction Detail: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, ANDREW GARRETT, INC. CONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS, THEREFORE, THE FIRM IS CENSURED AND FINED 7,500.00, JOINTLY AND SEVERALLY.

Allegations: SEC RULES 15C3-1 AND 17A-3 AND NASD RULES 2110 AND 3110: RESPONDENT MEMBER FIRM, ACTING THRU AN INDIVIDUAL, CONDUCTED A SECURITIES BUSINESS WHEN ITS NET CAPITAL FELL BELOW THE MINIMUM AMOUNT REQUIRED UNDER SEC RULE 15C3-1; AND IT PREPARED INACCURATE NET CAPITAL COMPUTATION. Status: Final Sanction Detail: WITHOUT ADMITTING OR DENYING THE FINDINGS, RESPONDENT MEMBER FIRM CONSENTED TO THE THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS; THEREFORE , FIRM IS CENSURED AND FINED $17500.00 OF WHICH $7500.00 IS JOINTLY AND SEVERALLY.

Allegations: NASD EXAMINERS FOUND THAT THE CONTROL AFFILIATE HAD VIOLATED THE FIRM'S RESTRICTION LETTER BY HAVING MORE THAN 15% OF NET CAPITAL AT RISK IN INVENTORY POSITIONS. Status: Final Sanction Detail: ACCEPTANCE WAIVER AND CONSENT WITH A $5000.00 JOINT AND SEVERAL FINE NAMING BOTH THE CONTROL AFFILIATE AND THE FIRM. Summary: ACCEPTANCE WAIVER AND CONSENT WITH A $5000.00 FINE. THE FINE WAS JOINT AND SEVERAL NAMING BOTH THE CONTROL AFFILIATE AND THE FIRM.

Allegations: IN ATTEMPTING TO REGISTER THE BROKER/DEALER IN THE STATE OF WISCONSIN, THE CONTROL AFFILIATE DISCLOSED TO THEM THAT HE HAD DONE TRADES WITH SEVERAL WISCONSIN RESIDENTS. Status: Final Sanction Detail: WISCONSIN LEVIED A $500 FINE THEN REGISTERED THE BROKER DEALER AND THE CONTROL AFFILIATE IN THE STATE OF WISCONSIN. Summary: IN ATTEMPTING TO REGISTER THE BROKER DEALER IN WISCONSIN, THE CONTROL AFFILIATE DISCLOSED TO WI THAT HE HAD DONE TRADES WITH SEVERAL WI RESIDENTS. THEY LEVIED A FINE OF $500 THEN GRANTED REGISTRATION TO THE B/D AND CONTROL AFFILIATE.

Allegations: MDBI EFFECTED 2 SECURITIES TRANSACTIONS IN THE STATE OF MASSACHUSETTS WITHOUT PROPER REGISTRATION. Status: Final Sanction Detail: MDBI WAS REQUIRED TO OFFER A RECISSION TO THE CLIENTS IN MASSACHUSETTTS AND PAY AN ADMINISTRATIVE FEE OF $1400.00 TO THE STATE. Summary: MDBI OFFERED A RECISSION TO THE CLIENTS IN MASSACHUSETTS AND PAID AN ADMISTRATIVE FEE OF $1400.00 TO THE STATE.

Allegations: MDBI, INC. APPLIED FOR ALABAMA REGISTRATION ON 2/5/98, AND IN ERROR STATED THAT WE HAD NO PRIOR BUSINESS IN THAT STATE. SEVERAL TRADES WERE TRANSACTED BY 3 REPS, JOSHUA DUGHI, DAVID BARON, AND LAWRENCE CLASBY. A CEASE AND DESIST ORDER WAS ISSUED ON 7/7/98 FOR EFFECTING SECURITIES TRANSACTIONS WITH ALABAMA RESIDENTS PRIOR TO REGISTRATION AS A BD/AGENT AND FOR FILING A FALSE STATEMENT. Status: Final Sanction Detail: RECISSION OFFERS WERE ORDERED AND COMPLETED. THE CEASE AND DESIST ORDER IS HERBY RESOLVED BY A CONSENT ORDER WITH MDBI, BARON AND CLASBY ON 8/23/99. CONSENT ORDER WAS PREVIOUSLY ENTERED WITH DUGHI ON 3/2/99. THE ADMINSTRATIVE ASSESSMENT AND INVESTIGATIVE COSTS HAVE BEEN PAID AND REGISTRATION HAS BEEN GRANTED AS OF 9/13/99. Summary: RECISSION OFFERS WERE ORDERED AND COMPLETED. THE ADMINSTRATIVE ASSESSMENT AND INVESTIGATIVE COSTS HAVE BEEN PAID. MDBI, CLASBY AND BARON RECEIVED A CONSENT ORDER ON 8/23/99. DUGHI'S CONSENT ORDER WAS ENTERED ON 3/2/99. MDBI IS NOW REGISTERED IN THE STATE OF ALABAMA, AS OF 9/13/99.