FINRA

NASD RULES 2110, 3040: FROM AUGUST 2008 THROUGH NOVEMBER 2009, SABADO OFFERED AND SOLD TWO ENTITIES' OIL AND GAS INVESTMENTS TO SEVERAL OF HER CLIENTS WITHOUT THE KNOWLEDGE OR CONSENT OF HER MEMBER FIRM. ON AUGUST 31, 2010, THE SECURITIES AND EXCHANGE COMMISSION FILED A PARTIALLY SETTLED CIVIL INJUNCTIVE ACTION ALLEGING THAT BETWEEN JUNE 2007 AND SEPTEMBER 2009, THE ENTITIES AND AN INDIVIDUAL HAD FRAUDULENTLY SOLD INVESTMENTS IN TEXAS OIL AND GAS PROJECTS, RAISING APPROXIMATELY $22 MILLION FROM 300 INVESTORS NATIONWIDE. AS A RESULT OF SABADO'S RECOMMENDATIONS, SIX OF HER CURRENT FIRM CLIENTS MADE INVESTMENTS WITH THE ENTITIES TOTALING $491,880. SABADO FAILED TO PROVIDE HER FIRM WITH PRIOR NOTICE OF HER PARTICIPATION IN THESE SECURITIES TRANSACTIONS.

Acceptance, Waiver & Consent(AWC)

Bar (Permanent)

All Capacities

6/15/2011

WITHOUT ADMITTING OR DENYING THE FINDINGS, SABADO CONSENTED TO THE DESCRIBED SANCTION AND TO THE ENTRY OF FINDINGS; THEREFORE, SHE IS BARRED FROM ASSOCIATION WITH ANY FINRA MEMBER IN ANY CAPACITY.

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

SEC ADMIN RELEASES 33-9160, 34-63394; IA RELEASE 3116, NOVEMBER 30, 2010: THE SECURITIES AND EXCHANGE COMMISSION ("COMMISSION") DEEMS IT APPROPRIATE AND IN THE PUBLIC INTEREST THAT PUBLIC ADMINISTRATIVE AND CEASE-AND-DESIST PROCEEDINGS BE INSTITUTED PURSUANT TO SECTION 8A OF THE SECURITIES ACT OF 1933 ("SECURITIES ACT"), SECTIONS 15(B)(6) AND 21C OF THE SECURITIES EXCHANGE ACT OF 1934 ("EXCHANGE ACT"), AND SECTION 203(F) OF THE INVESTMENT ADVISERS ACT OF 1940 ("ADVISERS ACT") AGAINST PRISCILLA G. SABADO ("RESPONDENT" OR "SABADO"). THE DIVISION OF ENFORCEMENT ("DIVISION") ALLEGED THAT: SABADO OFFERED AND SOLD OIL AND GAS WORKING INTERESTS TO SEVERAL OF HER CLIENTS. WHILE SOLICITING HER CLIENTS, SABADO MADE MATERIAL MISREPRESENTATIONS AND OMISSIONS REGARDING THE RISKS OF THE RETURNS, THE PROJECTED RETURNS AND HER FAMILY'S INVESTMENT. AS A RESULT OF SABADO'S RECOMMENDATIONS, SIX OF HER CLIENTS PURCHASED WORKING INTERESTS IN OIL AND GAS LEASES IN THE AGGREGATE AMOUNT OF $491,880. SABADO, WHO HAD NO EXPERIENCE IN SELLING OR INVESTING IN OIL AND GAS WORKING INTERESTS, DID NO MEANINGFUL DUE DILIGENCE ON THE INVESTMENTS OR THE PURPORTED OIL COMPANY SELLING THEM. THE COMPANY AGREED TO PAY SABADO AN 8% TO 10% COMMISSION FOR EACH WORKING INTEREST SOLD, WHICH IT PAID IN THE FORM OF WORKING INTERESTS IN ONE OF ITS PROJECTS. SABADO OFFERED AND SOLD WORKING INTERESTS TO HER CLIENTS. IN DOING SO, SHE VIOLATED HER FIRM'S COMPLIANCE POLICIES AND PROCEDURES PROHIBITING SELLING AWAY AND REQUIRING DISCLOSURE TO, AND APPROVAL BY, THE FIRM OF ALL OUTSIDE BUSINESS. SABADO WAS AWARE OF HER FIRM'S REQUIREMENT THAT SHE OBTAIN ITS APPROVAL PRIOR TO SELLING OIL AND GAS WORKING INTERESTS AND FAILED TO OBTAIN THE REQUIRED APPROVAL. SHE ALSO FAILED TO DISCLOSE THESE SALES ON HER ANNUAL OUTSIDE BUSINESS ACTIVITIES FORMS. IN ADDITION, SHE MADE SEVERAL MATERIAL MISREPRESENTATIONS AND OMISSIONS WHILE OFFERING THE OIL AND GAS WORKING INTERESTS TO HER CLIENTS. FOR EXAMPLE, SABADO TOLD SOME OF HER CLIENTS TO EXPECT MONTHLY "DIVIDENDS" OF $1,200 TO $2,500, BEGINNING WITHIN THREE MONTHS OF THEIR INITIAL INVESTMENT. SABADO ALSO FALSELY REPRESENTED TO SOME INVESTORS THAT HER FAMILY INVESTED IN THE PURPORTED OIL COMPANY. IN REALITY, HER RELATIVES RECEIVED THEIR WORKING INTERESTS AS COMPENSATION FOR SABADO'S SALES. FURTHER, SABADO FALSELY TOLD CERTAIN INVESTORS THAT HER FAMILY WAS RECEIVING $5,000 A MONTH FROM THEIR INVESTMENT. SABADO ALSO FAILED TO ADEQUATELY DISCLOSE THE RISKS INVOLVED IN THE OIL AND GAS INVESTMENTS, TELLING HER CLIENTS THAT THE PROJECT INCLUDED A PROVEN WELL AND THAT THEY WOULD "MOST LIKELY" RECEIVE THE PROMISED RETURNS. SABADO ASSURED ONE OF HER CLIENTS, A FINANCIALLY UNSOPHISTICATED 24-YEAR-OLD BLIND MAN, THAT HE WOULD RECEIVE $2,500 TO $5,000 FROM HIS INVESTMENT. SHE EVEN INSTRUCTED HIM TO REPRESENT IN THE COMPANY'S SUBSCRIPTION DOCUMENTS THAT HE WAS A SOPHISTICATED, ACCREDITED INVESTOR, WHEN HE WAS NOT. IN REALITY, HE WAS AN UNACCREDITED INVESTOR SEEKING A SAFE, INCOME-PRODUCING PRODUCT FOR OVER $139,000 HE RECEIVED AS PART OF THE SETTLEMENT OF A LAWSUIT OVER THE ACCIDENT THAT CAUSED HIS BLINDNESS. SABADO CONTINUED TO SOLICIT NEW SALES OF OIL AND GAS PROJECTS EVEN AFTER HER EARLIER CLIENTS COMPLAINED THAT THEY WERE NOT RECEIVING THE PROMISED RETURNS. IN PARTICULAR, SABADO RECOMMENDED THAT TWO CLIENTS, ONE OF WHOM WAS UNACCREDITED, BUY ANOTHER OIL AND GAS PROJECT, TELLING THESE CLIENTS THAT THEY WOULD RECEIVE SIGNIFICANT MONTHLY INCOME. SHE FAILED TO TELL THEM, HOWEVER, THAT HER OTHER CLIENTS HAD YET TO RECEIVE THEIR PROJECTED RETURNS FROM A SIMILAR INVESTMENT. THE DIVISION ALLEGED THAT SABADO VIOLATED SECTIONS 5(A), 5(C) AND 17(A) OF THE SECURITIES ACT AND SECTIONS 10(B) AND 15(A) OF THE EXCHANGE ACT AND RULE 10B-5 THEREUNDER.

Order

Bar (Permanent)

ASSOCIATION WITH ANY BROKER, DEALER, INVESTMENT ADVISER, MUNICIPAL SECURITIES DEALER, OR TRANSFER AGENT

Indefinite

WITH THE RIGHT TO REAPPLY AFTER 5 YEARS

7/14/2011

PARTICIPATING IN ANY OFFERING OF A PENNY STOCK

Indefinite

WITH THE RIGHT TO REAPPLY AFTER 5 YEARS

7/14/2011

Cease and Desist

Civil and Administrative Penalty(ies)/Fine(s)

$25,000.00

Disgorgement

$2,341.00

Monetary Penalty other than Fines

$275.00