A Colorado firm's founder has agreed to pay a $20,000 civil penalty after the Securities and Exchange Commission charged his firm with engaging in unregistered municipal advisory activity when it provided advice to two Idaho charter schools in connection with bond offerings.
Respondents Ford Research & Solutions, Inc. and James Ford consented to the penalty without admitting or denying the SEC's findings, according to an order issued Feb. 12.
The action is the latest in a series of municipal securities enforcement actions brought by the SEC in its bid to
"This matter involves unregistered municipal advisory activity by Ford Research and its president, founder, owner, and sole employee Ford," the SEC's order said. "From 2021 through 2024, Ford Research, through Ford, provided municipal advisory services in connection with two municipal bond issuances for the benefit of two charter schools in Idaho."
By engaging in municipal advisory activities without registering with the SEC, "Ford Research willfully violated the registration requirements of Section 15B(a)(1)(B) of the Exchange Act, and Ford caused Ford Research's violation," the SEC's order said.
Ford, a 76-year-old Denver resident, founded Denver-based Ford Research in 2011, the order said. The advice provided by Ford and his firm during the relevant period included advice on the structure, timing and terms of the offerings; soliciting and selecting underwriter services; potential bond interest rates; preparation of bond offering disclosure documents; the credit rating process and investor call strategy, the SEC's order said.
"Ford Research's advice was particularized to the specific objectives and circumstances of its clients," the order said.
The two charter schools financed about $17.8 million in an aggregate par amount of municipal securities in the two offerings, the order said. The schools paid Ford Research consulting fees for its municipal advisory services.
"Although Ford was aware of the municipal advisor registration requirements, Ford Research never registered with the commission," the SEC's order said. "As a result, Ford Research was not registered as [a] municipal advisor when it engaged in municipal advisory activity during the relevant period."
The Dodd-Frank Wall Street Reform and Consumer Protection Act, which Congress passed in 2010, amended Section 15B of the Exchange Act to provide for the registration and regulation of municipal advisors. In 2013, the SEC adopted final rules for municipal advisor registration that became effective July 1, 2014.
Ford declined to comment.
