FINRA

Sapareto was named a respondent in a FINRA complaint alleging that he engaged in an OBA without providing prior written notice to his member firm. The complaint alleges that Sapareto created a corporate entity for the purpose of producing and marketing a film. Sapareto paid over $8,000 for camera equipment, fees for actors, and to rent a cabin in which to film the movie. The firm learned about the OBA when Sapareto was sued in connection with his activities with the entity, and it promptly terminated Sapareto. The complaint also alleges that FINRA then commenced an investigation. Throughout that investigation, Sapareto repeatedly provided false or misleading information to FINRA to conceal his involvement in his OBA. Sapareto provided false or misleading information in response to a written request for information and false or misleading sworn testimony to FINRA during an on-the-record interview. Among other things, Sapareto falsely told FINRA that the entity was formed without his knowledge or consent, that he was not involved in producing a movie, that he had not exchanged emails with a third party about producing the movie, and that he had not spent money in furtherance of entity's activities.

Decision

Bar (Permanent)

All capacities

indefinite

9/6/2021

Default decision rendered August 9, 2021. The sanction was based on findings that Sapareto engaged in an undisclosed outside business activity (OBA). The findings stated that Sapareto began his OBA when he took steps to produce a film in California that he intended to appear in and then market and sell. Before filming began, Sapareto paid, or authorized the payment of, more than $3,000 in expenses for the movie's production. At around this time, Sapareto recruited a director to direct the planned movie. Sapareto sent the director more than a hundred emails from his personal account concerning, for example, finding and paying actors, finding and paying for a location to film the movie, and purchasing filming equipment and advertising. Sapareto paid over $1,000 to rent the location and over $700 to a marketing professional to create a website and for on-line advertising. Sapareto also paid over $1,000 for filming equipment. Also, Sapareto formed a limited liability company organized in New Hampshire. He had a business formation service company prepare and file a Certificate of Formation for the company with state authorities. The filing identified Sapareto as a member of the limited liability company and included his electronic signature. Sapareto traveled to California where he and the director filmed the movie, using as a location a cabin he rented for the purpose. The day of filming, he withdrew $5,100 in cash to pay for production expenses, which included fees to actors. Sapareto failed to disclose to the member firm his involvement in the company and his activities associated with making the film. The findings also stated that Sapareto made false or misleading written statements to FINRA. Sapareto denied that he had formed a company or filed any paperwork to conduct business involving the director or the company. Sapareto also denied having any correspondence with the director about the company or its activities (except for communicating with him about where they would meet in Los Angeles). The findings also included that Sapareto gave false or misleading testimony to FINRA under oath. Sapareto falsely denied having any involvement in forming the company and stated that he did not file the Certificate of Formation for the company, and that the filing was done without his knowledge. Sapareto falsely and repeatedly denied engaging in any business with the director or through the company involving the making of a film. Sapareto denied emailing the director about the production of the film and when shown an email he had sent to the director, he falsely denied having sent it. Sapareto denied traveling to California for the purpose of filming a movie that he intended to market and sell using the company, instead testifying that he went there for vacation and that he had loaned his camcorder to the director so that the director could film promotional videos. Sapareto falsely testified that the $5,100 in cash he withdrew was for personal expenses when in fact he used the money to pay expenses for the film. The decision became final on September 6, 2021.

Default decision rendered August 9, 2021. The sanction was based on findings that Sapareto engaged in an undisclosed outside business activity (OBA). The findings stated that Sapareto began his OBA when he took steps to produce a film in California that he intended to appear in and then market and sell. Before filming began, Sapareto paid, or authorized the payment of, more than $3,000 in expenses for the movie's production. At around this time, Sapareto recruited a director to direct the planned movie. Sapareto sent the director more than a hundred emails from his personal account concerning, for example, finding and paying actors, finding and paying for a location to film the movie, and purchasing filming equipment and advertising. Sapareto paid over $1,000 to rent the location and over $700 to a marketing professional to create a website and for on-line advertising. Sapareto also paid over $1,000 for filming equipment. Also, Sapareto formed a limited liability company organized in New Hampshire. He had a business formation service company prepare and file a Certificate of Formation for the company with state authorities. The filing identified Sapareto as a member of the limited liability company and included his electronic signature. Sapareto traveled to California where he and the director filmed the movie, using as a location a cabin he rented for the purpose. The day of filming, he withdrew $5,100 in cash to pay for production expenses, which included fees to actors. Sapareto failed to disclose to the member firm his involvement in the company and his activities associated with making the film. The findings also stated that Sapareto made false or misleading written statements to FINRA. Sapareto denied that he had formed a company or filed any paperwork to conduct business involving the director or the company. Sapareto also denied having any correspondence with the director about the company or its activities (except for communicating with him about where they would meet in Los Angeles). The findings also included that Sapareto gave false or misleading testimony to FINRA under oath. Sapareto falsely denied having any involvement in forming the company and stated that he did not file the Certificate of Formation for the company, and that the filing was done without his knowledge. Sapareto falsely and repeatedly denied engaging in any business with the director or through the company involving the making of a film. Sapareto denied emailing the director about the production of the film and when shown an email he had sent to the director, he falsely denied having sent it. Sapareto denied traveling to California for the purpose of filming a movie that he intended to market and sell using the company, instead testifying that he went there for vacation and that he had loaned his camcorder to the director so that the director could film promotional videos. Sapareto falsely testified that the $5,100 in cash he withdrew was for personal expenses when in fact he used the money to pay expenses for the film. The decision became final on September 6, 2021.

Advisory Group Equity Services, Ltd.

Discharged

Mr. Sapareto formed Standard Video,LLC on June 6, 2018. This was done without receiving prior written approval from the Firm. This is a clear violation of our policies and FINRA Rule 3270.