FINRA censured WestPark Capital, Inc. and fined the Los Angeles broker-dealer $175,000 in June 2026 after finding the firm willfully failed to supervise recommendations of speculative corporate bonds to ten retail customers, four of them seniors. The regulator also ordered $345,073 in restitution.
What happened in the WestPark Capital case
The settlement, a Letter of Acceptance, Waiver and Consent accepted under FINRA Case #2021070498107, found that WestPark violated Regulation Best Interest’s Care Obligation. Five of the firm’s registered representatives recommended speculative corporate bonds to ten retail customers between 2021 and 2023.
All ten customers carried moderate risk tolerances. None listed speculation among their investment objectives. Four were seniors. Six of the ten have already settled arbitration claims against the firm, and the remaining four are receiving restitution under this action.
Key facts from the FINRA settlement
| Item | Detail |
|---|---|
| Firm | WestPark Capital, Inc., CRD #39914, Los Angeles, California |
| Action | AWC accepted under FINRA Case #2021070498107, June 2026 |
| Sanctions | Censure, $175,000 fine, $345,073 restitution plus interest |
| Core findings | Willful Reg BI violation; failed supervision of speculative bond recommendations |
| Affected customers | 10 retail customers across 5 representatives; 4 seniors |
| Additional finding | Statutory disqualification exposure due to willful violation |
| Firm profile | FINRA member since 1996; about 55 representatives; 5 branch offices |
The findings went beyond the bond recommendations. FINRA also found WestPark failed to conduct reasonable due diligence on four private placement offerings by two issuers before recommending them to customers.
The private placement due diligence failures
The first issuer was a development-stage cannabis company formed in October 2018, with no revenue, no operating history, and no license to conduct business. WestPark representatives sold roughly $3.1 million of its first offering to 72 retail customers between December 2018 and January 2020, then another $365,000 to eight customers in mid-2020.
Before the second sale, the firm ignored red flags that included the issuer’s default on monthly distributions to first-offering investors and a lawsuit from its own landlord over unpaid rent.
The second issuer, a rent-to-own retailer, raised about $3.9 million from 90 WestPark customers and a further $2.7 million from 44 more. The firm’s investigation consisted of reading due diligence reports commissioned by the issuer itself. It never followed up on the warnings inside those reports, including a high debt-to-equity ratio and an inability to redeem roughly $30 million in outstanding notes at maturity.
WestPark Capital’s regulatory history
| Year | Action | Sanctions |
|---|---|---|
| Dec. 2017 | FINRA AWC over CMO supervision | Censure, $27,500 fine |
| Nov. 2021 | FINRA AWC over promissory note misrepresentations | Censure, $250,000 fine; CEO fined $30,000 and suspended |
| Sept. 2021 | State of Florida supervision findings | $10,000 fine |
| Dec. 2023 | FINRA AWC over AML program and supervision | Censure, $475,000 fine, $218,160 restitution |
| June 2026 | FINRA AWC over Reg BI and due diligence | Censure, $175,000 fine, $345,073 restitution |
Repeat enforcement is the pattern that matters for customers. Each action centered on the same root cause: supervisory systems that existed on paper but did not catch what representatives were actually selling.
What WestPark customers can do now
Customers who held speculative bonds or private placements through WestPark should pull their account statements and confirm whether they fall within the restitution group. The AWC covers four customers directly; six others settled separately in arbitration.
Investors outside those groups may still pursue individual FINRA arbitration claims. Eligibility generally extends six years from the transaction date under FINRA’s eligibility rule, which keeps 2020 through 2022 purchases in play.
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Haselkorn & Thibaut is a securities law firm founded by former Wall Street defense attorneys who shifted their practice to represent investors. The firm has recovered over $520 million for clients in securities matters and maintains a 98 percent success rate in resolved nontraded REIT cases. Attorneys are AV Preeminent rated through Martindale-Hubbell, designated as Super Lawyers, and hold a 5.0-star client review average. The firm operates on a contingency basis — no recovery, no fee.
Contact Haselkorn & Thibaut today
Time matters in broker misconduct cases. The earlier you act, the stronger your position. The firm offers a free case evaluation to assess your losses, review your account history, and explain your options under arbitration or settlement.
- Main Phone: 1-888-885-7162
- website for a free consultation
Offices in Florida, New York, Arizona, Texas, and North Carolina. Former Wall Street defense attorneys with 95+ years of combined experience. No recovery, no fee.
Frequently asked questions about the WestPark Capital fine
Who is WestPark Capital? A Los Angeles broker-dealer, CRD #39914, that has been a FINRA member since 1996 and employs roughly 55 registered representatives across five branch offices.
How much restitution did FINRA order? $345,073 plus interest, payable to four customers. Six other affected customers already settled arbitration claims.
What was the core violation? The firm willfully violated Regulation Best Interest by failing to supervise speculative corporate bond recommendations and by not conducting reasonable due diligence on four private placements.
Can I still file a claim? FINRA arbitration eligibility generally reaches back six years. Investors who bought speculative bonds or placements through WestPark in 2020 or later should request a case review with their statements in hand.
This article is for informational purposes only and does not constitute legal advice.
