A Florida-based broker-dealer was able to secure a $1.1 million loan from the Paycheck Protection Program around half a year after agreeing to pay a $225,000 fine over alleged supervisory failures, according to news reports.

On April 10, Axos Bank approved an application from Boca Raton-based Newbridge Securities Corp. for a $1.1 million forgivable loan, the South Florida Business Journal writes, citing data from the Small Business Administration. Newbridge’s loan — the largest approved in South Florida’s investment banking and securities sector — was for covering the payroll of 69 employees, according to the data cited by the publication.

Newbridge was able to obtain the forgivable loan even though in September 2019, it agreed — without admitting or denying the charges — to pay a $225,000 Finra fine over allegations of supervisory failures related to sales of complex products, the Business Journal writes.

The company has a track record of fines stretching back years, according to the publication. In all, it has 29 regulatory events and four arbitrations since 2000, the Business Journal writes, citing Newbridge’s BrokerCheck record.

In 2016, for example, the company settled charges with Finra, again without admitting or denying the charges, that it had overcharged customers more than $172,000 on investment trust purchases, and in 2015, Newbridge was fined $138,000 over allegations that it traded corporate bonds at unfair prices, according to the publication.

The SBA doesn’t specify whether a business kept or returned the loan amount, the Business Journal writes. Newbridge, meanwhile, didn’t respond to the publication’s request for comment.

he PPP was launched as part of the Coronavirus Aid, Relief, and Economic Security Act signed into law in March and was aimed at helping small businesses pay their employees in the wake of the Covid-19 crisis.

In all, around 5.2 million borrowers collectively obtained approximately $525 billion in forgivable loans through the PPP program by the time it ended in August. About a dozen news organizations filed a Freedom of Information Act request for information about the recipients amid concerns about abuses of the program, and in July, the SBA released limited information, and only on recipients of loans larger than $150,000 — while 87% of the loans were smaller.

The extent of the fraud became more apparent when the Department of Justice charged 57 firms in September with abuses of the program.

Nonetheless, the SBA stalled releasing complete information on the recipients for months, citing privacy concerns, until a judge ordered the agency to do so on December 2.

Before last week’s release, meanwhile, FA-IQ sister publication FundFire had found that several of the wealth management firms that received millions of dollars in PPP loans had disciplinary histories.

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