Cape Securities to Pay $145k in Restitution as Part of FINRA Settlement

Cape Securities Inc has agreed to pay restitution of $145,072 as part of a settlement with the Financial Industry Regulatory Authority (FINRA). From July 2020 to March 2023, the firm failed to establish and maintain a supervisory system reasonably designed to achieve compliance with Rule 15l-1(a)(1) of the Securities Exchange Act of 1934 (Reg BI). It also failed to reasonably supervise its registered representatives' recommendations for the purchase of GWG L Bonds and non-traditional exchange-traded products (NT-ETPs) for Reg BI compliance.

As a result, Cape Securities willfully violated Reg BI and FINRA Rules 3110 and 2010. Additionally, from May 2023 to March 2025, the firm failed to timely respond to eight requests for information under FINRA Rule 8210, violating FINRA Rules 8210 and 2010. For these violations, the firm was censured and ordered to pay partial restitution of $145,072.62, plus interest.

Cape Securities has been a FINRA member since 1976 and is headquartered in McDonough, Georgia. On March 19, 2026, the firm filed a Uniform Request for Broker Dealer Withdrawal (Form BDW) to terminate its FINRA registration. Prior to this filing, the firm had approximately 20 registered representatives and eight branch locations, conducting a general securities business offering investment products and services to retail customers. FINRA retains jurisdiction over the firm pursuant to its By-Laws.

Pursuant to FINRA's Sanction Guidelines, FINRA did not impose a monetary fine after considering the respondent's revenues and financial resources, its Form BDW filing to terminate registration, and its agreement to pay restitution.