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Robert Cuculich Named in SEC Complaint

Robert Cuculich (CRD #: 706353), a broker registered with Pinnacle Investments, is involved in an SEC civil complaint, according to his BrokerCheck record, accessed on July 6, 2023. If you have questions about his alleged conduct as a broker, keep reading.

SEC Civil Complaint

On May 5, 2023, the Securities and Exchange Commission filed a civil complaint against Robert Cuculich, Pinnacle Advisors, and several other defendants alleging their involvement in the failure of an open-end investment company (the “NYSA Fund”) to comply with Rules 22e-4 (the “Liquidity Rule”) and 30b1-10 under the Investment Company Act of 1940.

The SEC alleged that, from June 2019 to June 2020, the NYSA Fund invested more than 15% of its net assets in the restricted shares of a medical device company. The fund allegedly failed to reduce its position in these shares to fall under the 15% threshold required by the SEC or to comply with the relevant reporting and filing requirements.

The SEC further alleged that Pinnacle Advisors and its principals, including Robert Cuculich, were primarily responsible for monitoring and classifying the liquidity of the NYSA Fund’s investments in accordance with the Liquidity Rule, and making required filings with the SEC and reports to the fund’s board of trustees.

Pinnacle Advisors, including Robert Cuculich, allegedly aided and abetted the NYSA Fund’s violations by failing to classify the medical device company’s restricted shares as an illiquid investment, despite the underlying restrictions, transfer limitations, and lack of any market for the shares that required that classification.

Additionally, these defendants allegedly disregarded the advice of the NYSA Fund’s counsel (who allegedly resigned over these issues) and the advice of the fund’s auditors.

Further, the SEC alleged that these defendants made false and misleading statements and omissions about their improper classification to the SEC’s Division of Investment Management. They allegedly also aided and abetted the NYSA Fund’s violations by failing to have the fund make timely submission of required reports to the fund’s board of trustees and the SEC.

The NYSA Fund allegedly deregistered with the SEC on September 9, 2020. Despite allegedly transferring its assets to a liquidating trust, the SEC alleged that the shares involved in this complaint have not yet been sold in the more than 2 ½ years since the fund’s deregistration, and that investors in the NYSA Fund have not received a distribution relating to these shares.

The SEC alleged that Robert Cuculich aided and abetted the NYSA Fund’s violations of Rules 22e-4(b)(1) and 30b1-10 of the Investment Company Act. This civil complaint is currently pending.

Investment Company Act of 1940

Section 22e-4(b)(1) of the Investment Company Act describes what elements are required to be included in the policies and procedures of the liquidity risk management programs of investment funds, including exchange-traded funds.

Section 30b1-10 requires all registered open-end and closed-end management investment companies (excluding money market funds) to file Form N-RN reports with the SEC. These reports describe the liquidity of these companies’ investments.

Background Information

Robert Cuculich has passed the following exams:

  • Series 63 – Uniform Securities Agent State Law Examination
  • SIE – Securities Industry Essentials Examination
  • Series 7 – General Securities Representative Examination
  • Series 6 – Investment Company Products/Variable Contracts Representative Examination
  • Series 52 – Municipal Securities Representative Examination
  • Series 53 – Municipal Securities Principal Examination
  • Series 24 – General Securities Principal Examination

Robert Cuculich is a registered broker in 24 states and a registered investment adviser in New York.

He previously worked for Cadaret, Grant & Company (CRD#:10641) and Flagship Securities (CRD#:7123).

Kurta Law Can Help

If you worked with Robert Cuculich and you have concerns about your investments, please contact us today at 877-600-0098 or for a free consultation.

For over 20 years, Kurta Law has advocated on behalf of investors who want to recover their investment losses from brokers and brokerage firms. Kurta Law is a nationally recognized law firm and exclusively represents investors against brokers and brokerage firms on a contingency basis. This means that the firm only earns a fee if our securities attorneys recover money on your behalf.