According to FINRA, Matthew Thomas Higgins was fined $5,000 and suspended from association with any FINRA member firm in all capacities for three months for participating in private securities transactions without providing prior written notice to his member firm.

Higgins solicited two investors to invest a total of $150,000 in partnership interests issued by a crypto asset investment fund he co-founded. He also solicited one of those investors and an additional investor to invest $200,000 in promissory notes issued by a crypto asset mining company he co-founded.

Higgins introduced the investment opportunities to investors, answered their questions, sent offering documents, and facilitated the transactions. None of the investors were customers of Higgins' firm, and Higgins did not receive any commissions for soliciting these transactions.

FINRA Rule 3280 requires registered representatives to provide prior written notice to their firms before participating in private securities transactions. This requirement allows firms to evaluate the transactions for potential risks and conflicts, and to determine whether additional supervision is needed.

Private securities transactions that occur outside of a firm's supervision present risks to investors because they may not receive the same protections as transactions conducted through the firm. Even when representatives do not receive compensation, firms need to know about these activities.

The suspension is in effect from January 6, 2025, through April 5, 2025. Investors should be cautious about investment opportunities presented outside of normal brokerage channels.