SEC forces Bingham, Malachi out of the muni business
WASHINGTON – The Securities and Exchange Commission has barred municipal advisor Porter Bingham from the muni bond industry and revoked the registration of his Atlanta-based firm, Malachi Financial Products, as a municipal advisor.
The SEC announced thee actions in separate administrative orders Monday.
The commission announced last week that Bingham and his firm had agreed to pay a combined $75,000 in civil penalties and disgorge $33,000 plus $2,858 in prejudgment interest to settle charges that they defrauded the City of Rolling Fork, Miss. in connection with a 2015 muni bond offering.
The orders mean that Malachi can no longer operate as a municipal advisory business, and that Bingham may not work as a muni advisor, dealer, investment adviser, or for a rating agency.
Malachi and Bingham did not admit or deny the allegations in the SEC’s civil lawsuit, but the commission said the firm billed the city $33,000 for services it did not perform.
The SEC also found that Bingham failed to disclose to the city that he had accepted payments totaling $2,500 from Anthony Stovall, an employee of a municipal underwriter, just before he and Malachi recommended that the city hire Stovall's firm to underwrite the bond offering. Stovall's firm was hired based on the recommendation, the SEC said.
Stovall settled with the SEC in January, agreeing to serve a six-month suspension and to pay a $20,000 civil penalty.