Howard Lutnick, Chairman and CEO of BGC Partners Inc., speaks at the Piper Sandler Global Exchange and FinTech Conference in New York City, the United States, on June 8, 2022.
Brendan McDermid | Reuters
Washington—— Securities and Exchange Commission Thursday’s charges against global financial services firm Cantor Fitzgerald and Violate the law Relevant to the regulatory disclosures so-called blank check companies make before raising money from the public.
Cantor Chairman and Chief Executive Officer, Howard LutnickRecently nominated by President-elect Donald Trump to lead the Department of Commerce. Lutnick is the co-chairman of Trump’s transition team.
Cantor agrees to pay a fee to settle SEC charges $6.75 million civil penalty and agreed not to violate the securities laws involved in this case.
The company does not admit or deny the allegations, which relate to certain anti-fraud and agency provisions of the federal securities laws.
Cantor’s settlement echoes an $18 million settlement at another blank check company, Digital World Acquisition Company., agreed to pay the SEC in July 2023 after being charged with fraud for failing to disclose to investors that DWAC had engaged in extensive merger discussions with Trump’s then-private social media company, Trump Media. Earlier this year, DWAC merged with Trump Media.
It was unclear Thursday night whether the Trump transition review team was aware of the SEC investigation into Cantor when the president-elect said he had chosen Lutnick to be Commerce secretary.
On October 27, 2024, at Madison Square Garden in New York, USA, Cantor Fitzgerald Chairman and CEO Howard Lutnick, the Republican presidential candidate and former U.S. President Donald Trump made the gesture while speaking at a rally.
Andrew Kelly | Reuters
this The U.S. Securities and Exchange Commission, in order The investigation released Thursday found that Cantor caused two blank-check companies, also known as SPACs, to falsely deny in regulatory filings that there had been contact or substantive discussions with potential merger targets ahead of the SPACs’ initial public offerings.
A SPAC is a shell company that has no underlying business before possibly merging with a target company that has operational operations.
Two SPACs controlled by Cantor executive team raise funds $750 million Investors in IPO ahead of merger with smart glass maker view and satellite logic corp.The U.S. Securities and Exchange Commission said the company is a satellite imagery and geospatial data company.
The SEC said teams of Cantor executives and Cantor subsidiary employees scouted potential merger companies for the two SPACs and had “substantial discussions” with potential targets. These discussions take place before the blank-check company registers and begins its IPO.
View announced an agreement to merge with Cantor SPAC CF Finance Acquisition Corp. in November 2020. Satellogic announced an agreement to merge with CF Acquisition Corp. V in July 2021.
“This enforcement action reflects the simple proposition that any disclosures about substantive discussions with potential targets must be materially accurate,” said. Sanjay WadhwaThursday, acting director of the SEC’s Division of Enforcement.
“Cantor Fitzgerald has repeatedly stated in public filings that while it has had substantive discussions with several private companies regarding potential mergers, including those partnering with its SPAC, it has not identified or is close to any potential merger targets, thereby misleading investors about key investment considerations.
“No investors were harmed by the issues described in this order,” Cantor spokesperson Erica Chase said in an email to CNBC.
“We are pleased to have reached agreement with the SEC to bring this matter to a close,” Chase said.
The Trump transition team did not immediately respond to a request for comment on the case.
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