Financial firm Cantor Fitzgerald settles with the SEC for $6.75 million due to accusations of deceiving investors regarding Special Purpose Acquisition Company (SPAC) disclosures.
Financial firm Cantor Fitzgerald has consented to fork over a $6.75-million fine to resolve Securities and Exchange Commission allegations of deceiving investors in blank-check enterprises it controlled, the regulatory body announced on Thursday.
Cantor Fitzgerald failed to provide a comment promptly in response to a request. As per the SEC, Cantor neither acknowledged nor disputed the watchdog's claims.
Blank-check ventures, also known as special purpose acquisition companies (SPACs), are shell corporations that gather funds via listings with the plan to acquire a private company and subsequently take it public, bypassing the initial public offering process.
The SEC maintains that a group of Cantor Fitzgerald executives directed and controlled two SPACs that raked in $750 million from investors through IPOs prior to the SPACs merging with View and Satellogic in 2020 and 2021, respectively.
In their SEC filings, the SPACs asserted that they had not engaged in substantial talks with possible takeover targets before their IPOs, despite the fact that Cantor, functioning on behalf of the SPACs, had already initiated negotiations with View and Satellogic, according to the SEC.
"This enforcement action underscores the straightforward premise that any disclosures concerning substantial discussions with potential targets must be materially accurate," stated Sanjay Wadhwa, acting director of the SEC’s Division of Enforcement, in a statement.
Cantor Fitzgerald operated as the controlling entity for two blank-check ventures, generating $750 million from investors through IPOs. The business was accused by the SEC of failing to disclose substantial talks with potential takeover targets before the IPOs.
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