Appeals Court Weighs ‘Dealer’ Definition in Stock-Flipping Case

December 13, 2023, 10:09 PM UTC

A federal appeals court seemed inclined to uphold the Securities and Exchange Commission’s win against a Florida man’s company for operating as an unregistered dealer, while leery of a ruling that exposes wide swaths of the financial industry to new standards.

Ibrahim Almagarby and his company, Microcap Equity Group LLC, are appealing a district court order finding MEG should’ve registered as a dealer. The case has drawn interest from financial trade groups that argue the SEC is pushing an untested view of what it means to be a dealer.

The lower court’s ruling that any business buying or selling securities ...

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