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BrokerCheck Report

IMS SECURITIES, INC.

Section Title

Report Summary

Registration and Withdrawal

Firm History

CRD# 35567

1

2

7

Firm Profile 3 - 6

Page(s)

Firm Operations 8 - 12

Disclosure Events 13

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CRD# 35567

SEC# 8-46722

Main Office Location

10205 WESTHEIMERSUITE 500HOUSTON, TX 77042

Mailing Address


Business Telephone Number

713-266-2993

Report Summary for this Firm

This report summary provides an overview of the brokerage firm. Additional information for this firm can be foundin the detailed report.

Disclosure Events

Brokerage firms are required to disclose certaincriminal matters, regulatory actions, civil judicialproceedings and financial matters in which the firm orone of its control affiliates has been involved.

Are there events disclosed about this firm? Yes

The following types of disclosures have beenreported:

Type Count

Regulatory Event 6

Arbitration 3

Firm Profile

This firm is classified as a corporation.

This firm was formed in Texas on 10/04/1993.

Its fiscal year ends in December.

Firm History

Information relating to the brokerage firm's historysuch as other business names and successions(e.g., mergers, acquisitions) can be found in thedetailed report.

Firm Operations

This brokerage firm is no longer registered withFINRA or a national securities exchange.

www.finra.org/brokercheck User Guidance

1©2018 FINRA. All rights reserved. Report about IMS SECURITIES, INC.


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This section provides information relating to the date the brokerage firm ceased doing business and the firm's financialobligations to customers or other brokerage firms.

Registration Withdrawal Information

11/30/2017

No

This firm terminated orwithdrew registration on:

Does this brokerage firm oweany money or securities toany customer or brokeragefirm?






This firm is classified as a corporation.

This firm was formed in Texas on 10/04/1993.

CRD#

This section provides the brokerage firm's full legal name, "Doing Business As" name, business and mailingaddresses, telephone number, and any alternate name by which the firm conducts business and where such name isused.

Firm Profile

Firm Names and Locations

Its fiscal year ends in December.


SEC#

35567

8-46722

Main Office Location

Mailing Address

Business Telephone Number

Doing business as IMS SECURITIES, INC.

713-266-2993



Other Names of this Firm

Name Where is it used

IMS INSURANCE AGENCY OF TEXAS, INC. KY

IMS INSURANCE AGENCY, INC. TX






This section provides information relating to all direct owners and executive officers of the brokerage firm.

Direct Owners and Executive Officers

Firm Profile

Position

Percentage of Ownership

Is this a public reportingcompany?

Position Start Date

Does this owner direct themanagement or policies ofthe firm?

WADSWORTH, JACKIE DIVONO

CHIEF EXECUTIVE OFFICER, COMPLIANCE OFFICER

75% or more

No

Individual

10/1993

Yes

2342163

Is this a domestic or foreignentity or an individual?

Legal Name & CRD# (if any):

Position



Position Start Date


GAMMON, CHRISTOPHER DAVID

CHIEF FINANCIAL OFFICER, VP-OPTIONS

Less than 5%

No

Individual

10/1993

No

2354523



Position

Position Start Date

SPEARS, MICHAEL J

CHIEF COMPLIANCE OFFICER

Individual

01/2009

4501523








Direct Owners and Executive Officers (continued)

Firm Profile



Position Start Date


Less than 5%

No

01/2009

No






This section provides information relating to any indirect owners of the brokerage firm.

Indirect Owners

Firm Profile

No information reported.






Firm History

This section provides information relating to any successions (e.g., mergers, acquisitions) involving the firm.

No information reported.






Firm Operations

RegistrationsThis section provides information about the regulators (Securities and Exchange Commission (SEC), self-regulatoryorganizations (SROs), and U.S. states and territories) with which the brokerage firm is currently registered andlicensed, the date the license became effective, and certain information about the firm's SEC registration.

The firm's registration was from 02/14/1994 to 12/28/2017.

This firm is no longer registered.






Firm Operations

Types of BusinessThis section provides the types of business, including non-securities business, the brokerage firm is engaged in orexpects to be engaged in.

Other Types of Business

This firm does not effect transactions in commodities, commodity futures, or commodity options.This firm does not engage in other non-securities business.

Non-Securities Business Description:

This firm currently conducts 12 types of businesses.

Types of Business

Broker or dealer retailing corporate equity securities over-the-counter

Broker or dealer selling corporate debt securities

Mutual fund retailer

U S. government securities broker

Municipal securities broker

Broker or dealer selling variable life insurance or annuities

Solicitor of time deposits in a financial institution

Broker or dealer selling oil and gas interests

Put and call broker or dealer or option writer

Broker or dealer selling tax shelters or limited partnerships in primary distributions

Private placements of securities

Other - INVESTMENT BANKING ACTIVITIES (IB)






Firm Operations

Clearing Arrangements

This firm does not hold or maintain funds or securities or provide clearing services for other broker-dealer(s).

Introducing Arrangements

This firm does not refer or introduce customers to other brokers and dealers.






Firm Operations

Industry Arrangements

This firm does not have books or records maintained by a third party.

This firm does not have accounts, funds, or securities maintained by a third party.

This firm does have customer accounts, funds, or securities maintained by a third party.

This firm does not have individuals who control its management or policies through agreement.

This firm does not have individuals who wholly or partly finance the firm's business.

Control Persons/Financing

Name: HILLTOP SECURITIES INC.

Business Address: 1200 ELM STREETDALLAS, TX 75770

CRD #: 6220

Effective Date: 12/20/1993

Description: FULLY DISCLOSED CLEARING AGREEMENT






Firm Operations

Organization AffiliatesThis section provides information on control relationships the firm has with other firms in the securities, investmentadvisory, or banking business.

This firm is, directly or indirectly:

· in control of· controlled by· or under common control withthe following partnerships, corporations, or other organizations engaged in the securities or investmentadvisory business.

Yes

Yes

No

02/20/2004

10205 WESTHEIMER RDSUITE 500HOUSTON, TX 77042

130914

IMS FINANCIAL ADVISORS, INC. is under common control with the firm.

IMS FINANCIAL ADVISORS, INC. IS AN AFFILIATED INVESMENT ADVISORDescription:

Investment AdvisoryActivities:

Securities Activities:

Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:

This firm is not directly or indirectly, controlled by the following:

· bank holding company· national bank· state member bank of the Federal Reserve System· state non-member bank· savings bank or association· credit union· or foreign bank






Disclosure Events

All firms registered to sell securities or provide investment advice are required to disclose regulatory actions, criminal orcivil judicial proceedings, and certain financial matters in which the firm or one of its control affiliates has been involved.For your convenience, below is a matrix of the number and status of disclosure events involving this brokerage firm orone of its control affiliates. Further information regarding these events can be found in the subsequent pages of thisreport.

Final On AppealPending

Regulatory Event 0 6 0

Arbitration N/A 3 N/A






Disclosure Event Details

What you should know about reported disclosure events:

1. BrokerCheck provides details for any disclosure event that was reported in CRD. It also includessummary information regarding FINRA arbitration awards in cases where the brokerage firm wasnamed as a respondent.

2. Certain thresholds must be met before an event is reported to CRD, for example: o A law enforcement agency must file formal charges before a brokerage firm is required to disclose a

particular criminal event.3. Disclosure events in BrokerCheck reports come from different sources:

o Disclosure events for this brokerage firm were reported by the firm and/or regulators. When the firmand a regulator report information for the same event, both versions of the event will appear in theBrokerCheck report. The different versions will be separated by a solid line with the reporting sourcelabeled.

4. There are different statuses and dispositions for disclosure events: o A disclosure event may have a status of pending, on appeal, or final.

§ A "pending" event involves allegations that have not been proven or formally adjudicated.§ An event that is "on appeal" involves allegations that have been adjudicated but are currently

being appealed.§ A "final" event has been concluded and its resolution is not subject to change.

o A final event generally has a disposition of adjudicated, settled or otherwise resolved.§ An "adjudicated" matter includes a disposition by (1) a court of law in a criminal or civil matter,

or (2) an administrative panel in an action brought by a regulator that is contested by the partycharged with some alleged wrongdoing.

§ A "settled" matter generally involves an agreement by the parties to resolve the matter.Please note that firms may choose to settle customer disputes or regulatory matters forbusiness or other reasons.

§ A "resolved" matter usually involves no payment to the customer and no finding ofwrongdoing on the part of the individual broker. Such matters generally involve customerdisputes.

5. You may wish to contact the brokerage firm to obtain further information regarding any of thedisclosure events contained in this BrokerCheck report.

Regulatory - Final

This type of disclosure event involves (1) a final, formal proceeding initiated by a regulatory authority (e.g., a statesecurities agency, self-regulatory organization, federal regulator such as the U.S. Securities and Exchange Commission,foreign financial regulatory body) for a violation of investment-related rules or regulations; or (2) a revocation orsuspension of the authority of a brokerage firm or its control affiliate to act as an attorney, accountant or federalcontractor.

Disclosure 1 of 6

Reporting Source: Regulator

Allegations: RESPONDENT IMS SECURITIES, INC. FAILED TO PAY FEES OF $65,944.20DUE TO FINRA.

Current Status: Final






Initiated By: FINRA

Principal Sanction(s)/ReliefSought:

Other

Other Sanction(s)/ReliefSought:

CANCELLATION

Date Initiated: 12/06/2017

Docket/Case Number: N/A

Principal Product Type: No Product

Other Product Type(s):

Allegations: RESPONDENT IMS SECURITIES, INC. FAILED TO PAY FEES OF $65,944.20DUE TO FINRA.

Resolution Date: 12/28/2017

Resolution:

Other Sanctions Ordered: CANCELLATION

Sanction Details: PURSUANT TO FINRA RULE 9553, IMS SECURITIES, INC. MEMBERSHIPWITH FINRA IS CANCELED AS OF DECEMBER 28, 2017 FOR FAILURE TO PAYOUTSTANDING FEES.

Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?

No

Sanctions Ordered:

Other

Disclosure 2 of 6

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Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOHAVE ADEQUATE SUPERVISORY PROCEDURES TO MONITOR VARIABLEANNUITY TRANSACTIONS FOR PROBLEMATIC RATES OF EXCHANGE. THEFINDINGS STATED THAT THE FIRM RELIED UPON ITS CHIEF FINANCIALOFFICER (CFO) TO REVIEW VARIABLE ANNUITY EXCHANGES EFFECTEDFOR REGULATORY COMPLIANCE, BUT PROVIDED HIM WITH NO GUIDANCEOR TOOLS SUCH AS EXCEPTION REPORTS OR TREND ANALYSIS TOASSIST WITH REVIEWS FOR PROBLEMATIC PATTERNS OF EXCHANGE. THERESOURCES AVAILABLE TO THE CFO FOR THE REVIEWS WERE LIMITEDTO THE VARIABLE ANNUITY APPLICATION AND THE ORDER RECORDS FORTHE EXCHANGE AT ISSUE. THE FINDINGS ALSO STATED THAT THE FIRMHAD WRITTEN SUPERVISORY PROCEDURES (WSPS) REGARDINGCONSOLIDATED REPORTS, BUT FAILED TO ENFORCE THE PROCEDURES.ACCORDING TO THE PROCEDURES, THE FIRM WAS TO REVIEW ANDAPPROVE THE CONSOLIDATED REPORTS PRIOR TO DISSEMINATION TOCLIENTS. THE FIRM ALLOWED MANUAL ENTRY OF VALUES FORINVESTMENTS NOT HELD AT THE FIRM, AND THE APPROVAL PROCESSREQUIRED VERIFICATION OF THE VALUE OF INVESTMENTS NOT HELD BYTHE FIRM. DESPITE THE WRITTEN PROCEDURES, THE FIRM FAILED TOREVIEW AND APPROVE REPORTS PRIOR TO DISSEMINATION. FOREXAMPLE, REGISTERED REPRESENTATIVES ASSOCIATED WITH THE FIRMSENT CONSOLIDATED REPORTS, AND ALTHOUGH THE FIRMREPRESENTED THAT IT WAS VERIFYING THE VALUES OF THEINVESTMENTS LISTED ON THE REPORTS, THE VERIFICATIONS OCCURREDAFTER DISSEMINATION TO THE CLIENTS, AND IN MANY INSTANCES, THEFIRM COULD PROVIDE NO SUPPORT OTHER THAN THE INITIALS OF APRINCIPAL ON THE REPORTS.







Initiated By: FINRA




Docket/Case Number: 2014039417401

Principal Product Type: Annuity(ies) - Variable


WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOHAVE ADEQUATE SUPERVISORY PROCEDURES TO MONITOR VARIABLEANNUITY TRANSACTIONS FOR PROBLEMATIC RATES OF EXCHANGE. THEFINDINGS STATED THAT THE FIRM RELIED UPON ITS CHIEF FINANCIALOFFICER (CFO) TO REVIEW VARIABLE ANNUITY EXCHANGES EFFECTEDFOR REGULATORY COMPLIANCE, BUT PROVIDED HIM WITH NO GUIDANCEOR TOOLS SUCH AS EXCEPTION REPORTS OR TREND ANALYSIS TOASSIST WITH REVIEWS FOR PROBLEMATIC PATTERNS OF EXCHANGE. THERESOURCES AVAILABLE TO THE CFO FOR THE REVIEWS WERE LIMITEDTO THE VARIABLE ANNUITY APPLICATION AND THE ORDER RECORDS FORTHE EXCHANGE AT ISSUE. THE FINDINGS ALSO STATED THAT THE FIRMHAD WRITTEN SUPERVISORY PROCEDURES (WSPS) REGARDINGCONSOLIDATED REPORTS, BUT FAILED TO ENFORCE THE PROCEDURES.ACCORDING TO THE PROCEDURES, THE FIRM WAS TO REVIEW ANDAPPROVE THE CONSOLIDATED REPORTS PRIOR TO DISSEMINATION TOCLIENTS. THE FIRM ALLOWED MANUAL ENTRY OF VALUES FORINVESTMENTS NOT HELD AT THE FIRM, AND THE APPROVAL PROCESSREQUIRED VERIFICATION OF THE VALUE OF INVESTMENTS NOT HELD BYTHE FIRM. DESPITE THE WRITTEN PROCEDURES, THE FIRM FAILED TOREVIEW AND APPROVE REPORTS PRIOR TO DISSEMINATION. FOREXAMPLE, REGISTERED REPRESENTATIVES ASSOCIATED WITH THE FIRMSENT CONSOLIDATED REPORTS, AND ALTHOUGH THE FIRMREPRESENTED THAT IT WAS VERIFYING THE VALUES OF THEINVESTMENTS LISTED ON THE REPORTS, THE VERIFICATIONS OCCURREDAFTER DISSEMINATION TO THE CLIENTS, AND IN MANY INSTANCES, THEFIRM COULD PROVIDE NO SUPPORT OTHER THAN THE INITIALS OF APRINCIPAL ON THE REPORTS.


Resolution:

Other Sanctions Ordered:


No

Sanctions Ordered: CensureMonetary/Fine $100,000.00

Acceptance, Waiver & Consent(AWC)





https://www.finra.org/industry/disciplinary-actions/finra-disciplinary-actions-online?search=2014039417401



Sanction Details: THE FIRM WAS CENSURED AND FINED $100,000.

iReporting Source: Firm

Initiated By: FINRA


Civil and Administrative Penalt(ies) /Fine(s)


CENSURE



Principal Product Type: Annuity(ies) - Variable


Allegations: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, THE FIRMCONSENTED TO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THATIT FAILED TO HAVE ADEQUATE SUPERVISORY PROCEDURES TO MONITORVARIABLE ANNUITY TRANSACTIONS FOR PROBLEMATIC RATES OFEXCHANGE. THE FINDINGS ALSO STATED THAT THE FIRM HAD WSPSREGARDING CONSOLIDATED REPORTS, BUT FAILED TO ENFORCE THEPROCEDURES.



Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDING,THEREFORE THE FIRM IS CENSURED AND FINED $100,000.00



Disclosure 3 of 6

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Allegations: SEC RULES 17A-3(A)(1) AND 17A-4(B)(4), FINRA RULE 2010, NASD RULES2110, 3010(A), 3010(B), 3010(C)(1), 3010(D)(3), 3110(A): THE FIRMREGISTERED SEVERAL WHOLESALE REPRESENTATIVES, BUT IT DID NOTTAILOR ITS SUPERVISORY SYSTEM TO THE SPECIFIC NATURE OF ITS NEWWHOLESALE BUSINESS THAT WAS REASONABLY DESIGNED TO ACHIEVECOMPLIANCE WITH APPLICABLE SECURITIES LAWS AND REGULATIONS,AND NASD RULES. ALTHOUGH SUPERVISING WHOLESALEREPRESENTATIVES WAS DIFFERENT THAN SUPERVISING RETAILREPRESENTATIVES, THE FIRM DID NOT REVISE ITS WRITTENSUPERVISORY PROCEDURES (WSPS), OR IMPLEMENT ANY PROCEDURESTAILORED TO SUPERVISING THE WHOLESALE REPRESENTATIVES UNTILNEARLY FOUR YEARS AFTER. THE FIRM SOLD A WIDE RANGE OFSECURITIES PRODUCTS, INCLUDING PRIVATELY-TRADED REAL ESTATEINVESTMENT TRUSTS AND DIRECT PARTICIPATION PLANS. DURING THISTIME PERIOD, HOWEVER, THE FIRM DID NOT HAVE SUFFICIENT WSPSDETAILING ITS PROCEDURES FOR ASSESSING PRIVATELY-TRADED REALESTATE INVESTMENT TRUSTS AND DIRECT PARTICIPATION PLANS. THEFIRM FAILED TO CONDUCT ANNUAL AUDITS AT TWO OF ITS OFFICES OFSUPERVISORY JURISDICTION (OSJ) BRANCH OFFICES IN A CERTAIN YEAR.THE FIRM'S WHOLESALE REPRESENTATIVES USED OUTSIDE EMAILADDRESSES TO SEND ELECTRONIC COMMUNICATIONS RELATED TO ITSSECURITIES BUSINESS. THE FIRM, HOWEVER, FAILED TO RETAIN THESEEMAILS. FOR NEARLY TWO YEARS, THE FIRM FAILED TO ADEQUATELYMAINTAIN PURCHASE AND SALES BLOTTERS AND CHECKS RECEIVED ANDFORWARDED BLOTTERS CONTAINING ALL OF THE REQUIREDINFORMATION. THUS, THE FIRM FAILED TO MAINTAIN BLOTTERSCONTAINING AN ITEMIZED DAILY RECORD OF ALL PURCHASES AND SALESOF SECURITIES, ALL RECEIPTS AND DISBURSEMENTS OF CASH, AND ALLOTHER DEBITS AND CREDITS.








Initiated By: FINRA


Other


N/A



Principal Product Type: Other

Other Product Type(s): PRIVATELY-TRADED REAL ESTATE INVESTMENT TRUSTS AND DIRECTPARTICIPATION PLANS

Allegations: SEC RULES 17A-3(A)(1) AND 17A-4(B)(4), FINRA RULE 2010, NASD RULES2110, 3010(A), 3010(B), 3010(C)(1), 3010(D)(3), 3110(A): THE FIRMREGISTERED SEVERAL WHOLESALE REPRESENTATIVES, BUT IT DID NOTTAILOR ITS SUPERVISORY SYSTEM TO THE SPECIFIC NATURE OF ITS NEWWHOLESALE BUSINESS THAT WAS REASONABLY DESIGNED TO ACHIEVECOMPLIANCE WITH APPLICABLE SECURITIES LAWS AND REGULATIONS,AND NASD RULES. ALTHOUGH SUPERVISING WHOLESALEREPRESENTATIVES WAS DIFFERENT THAN SUPERVISING RETAILREPRESENTATIVES, THE FIRM DID NOT REVISE ITS WRITTENSUPERVISORY PROCEDURES (WSPS), OR IMPLEMENT ANY PROCEDURESTAILORED TO SUPERVISING THE WHOLESALE REPRESENTATIVES UNTILNEARLY FOUR YEARS AFTER. THE FIRM SOLD A WIDE RANGE OFSECURITIES PRODUCTS, INCLUDING PRIVATELY-TRADED REAL ESTATEINVESTMENT TRUSTS AND DIRECT PARTICIPATION PLANS. DURING THISTIME PERIOD, HOWEVER, THE FIRM DID NOT HAVE SUFFICIENT WSPSDETAILING ITS PROCEDURES FOR ASSESSING PRIVATELY-TRADED REALESTATE INVESTMENT TRUSTS AND DIRECT PARTICIPATION PLANS. THEFIRM FAILED TO CONDUCT ANNUAL AUDITS AT TWO OF ITS OFFICES OFSUPERVISORY JURISDICTION (OSJ) BRANCH OFFICES IN A CERTAIN YEAR.THE FIRM'S WHOLESALE REPRESENTATIVES USED OUTSIDE EMAILADDRESSES TO SEND ELECTRONIC COMMUNICATIONS RELATED TO ITSSECURITIES BUSINESS. THE FIRM, HOWEVER, FAILED TO RETAIN THESEEMAILS. FOR NEARLY TWO YEARS, THE FIRM FAILED TO ADEQUATELYMAINTAIN PURCHASE AND SALES BLOTTERS AND CHECKS RECEIVED ANDFORWARDED BLOTTERS CONTAINING ALL OF THE REQUIREDINFORMATION. THUS, THE FIRM FAILED TO MAINTAIN BLOTTERSCONTAINING AN ITEMIZED DAILY RECORD OF ALL PURCHASES AND SALESOF SECURITIES, ALL RECEIPTS AND DISBURSEMENTS OF CASH, AND ALLOTHER DEBITS AND CREDITS.


Resolution: Acceptance, Waiver & Consent(AWC)









Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS,THEREFORE THE FIRM IS CENSURED AND FINED $100,000. FINE PAID INFULL ON 12/14/12.


No



Initiated By: FINRA


Other





Other Product Type(s): PRIVATELY-TRADED REAL ESTATE INVESTMENT TRUSTS AND DIRECTPARTICIPATION PLANS

Allegations: SUPERVISION OF WHOLESALE REPRESENTATIVES, FAILURE TO CONDUCTAUDITS AT TWO OF IT'S OSJ BRANCH OFFICES IN A CERTAIN YEAR.



Resolution:












Firm Statement IMS PRIDES ITSELF IN ITS INTEGRITY AND ALWAYS PLACES THE NEEDS OFITS CLIENTS FIRST. WHILE THE AWC STATES THAT IMS NEITHER ADMITSNOR DENIES THE ALLEGATIONS CONTAINED THEREIN; SOMEALLEGATIONS WITH WHICH THE FIRM DISAGREES, IMS IS MINDFUL OFFINRA REGULATIONS AND IS FULLY COMMITTED TO ABILDE BY THEM.

Disclosure 4 of 6

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Initiated By: TEXAS


Reprimand


Docket/Case Number: IC12-CAF-20

URL for Regulatory Action:



Allegations: 1. RESPONDENT'S FAILURES TO ENFORCE ITS WRITTEN SUPERVISORYPROCEDURES REGARDING HEIGHTENED SUPERVISION AND BRANCHOFFICE INSPECTIONS ARE VIOLATIONS OF §115.10(B)(1) OF THE RULESAND REGULATIONS OF THE TEXAS STATE SECURITIES BOARD ("BOARDRULES").2. PURSUANT TO SECTION 14.A(6) OF THE TEXAS SECURITIES ACT,RESPONDENT'S VIOLATIONS OF THE BOARD RULES ARE BASES FOR THEISSUANCE OF AN ORDER REPRIMANDING RESPONDENT.3. PURSUANT TO SECTION 23-1 OF THE TEXAS SECURITIES ACT,RESPONDENT'S VIOLATIONS OF THE BOARD RULES ARE BASES FOR THEASSESSMENT OF AN ADMINISTRATIVE FINE AGAINST RESPONDENT.1. IT IS THEREFORE ORDERED THAT IMS SECURITIES, INC. IS HEREBYREPRIMANDED.2. IT IS FURTHER ORDERED THAT IMS SECURITIES, INC. SHALL PAY ANADMINISTRATIVE FINE IN THE AMOUNT OF TWENTY THOUSAND DOLLARS($20,000.00) TO THE GENERAL FUND OF THE STATE OF TEXAS WITHIN ONEBUSINESS DAY OF THE DATE THIS ORDER IS ENTERED BY THESECURITIES COMMISSIONER.3. IMS SECURITIES, INC. IS FURTHER ORDERED TO COMPLY WITH THETERMS OF THE UNDERTAKING CONTAINED HEREIN.








Reprimand


FINE


Resolution:

Other Sanctions Ordered: REPRIMAND

Sanction Details: N/A

Regulator Statement N/A


No

Sanctions Ordered: Monetary/Fine $20,000.00

Order


Initiated By: TEXAS


Reprimand


FINE





Allegations: ALLEGATIONS OF FAILURE TO ENFORCE WRITTEN SUPERVISORYPROCEDURES.



Resolution:


Order







Sanction Details: N/A


Disclosure 5 of 6

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Initiated By: TEXAS


Reprimand


ADMINISTRATIVE FINE






Allegations: ON OR ABOUT FEBRUARY 7, 2008, IMS SECURITIES INC RECEIVED A COPYOF A COMPLAINT BY A COMPLAINANT WHO SUFFERED A LOSS IN THEAMOUNT OF $927.16 DUE TO A DELAY IN INVESTING FUNDS THROUGH ANAGENT(STEVEN KNOWLTON) OF IMS SECURITIES, INC., HOWEVER IMSSECURITIES, INC DID NOT AMEND KNOWLTON'S FORM U-4 TO REFLECTTHE COMPLAINT. IMS SECURITIES, INC. FAILED TO COMPLY WITH ITS OWNWRITTEN PROCEDURES, WHICH STATES: " 4.2.7 AMENDMENTS TO FORMU4... IMS WILL SUBMIT AMENDMENTS TO FORM U4 WHEN AN RR ADVISESOF UPDATED THAT REQUIRE AMENDMENT. THE CEO IS RESPONSIBLE FORDETERMINING WHETHER DISCIPLINARY OR COMPLAINT MATTERS OROTHER MATTERS REQUIRE THE FILING OF AN AMDNEMENT TO AN RR'SFORM U4." "5.7.7. REPORTING OF CUSOTMER COMPLAINTS.RESPONSIBILITY-CHIEF EXECUTIVE OFFICER...FREQUENCY-FORM U4S:PROMPTLY AFTER RECEIPT OF COMPLAINT...ACTION-IDENTIFYREPORTABLE COMPLAINTS..."



Resolution:


No

Order







Sanction Details: IMS SECURITIES, INC. HEREBY UNDERTAKES AND AGREES THAT WITHINTHIRTY (30) DAYS FROM THE DATE THE ORDER WAS SIGNED BY THESECURITIES COMMISSIONER, IMS SECURITIES INC WILL PAY THE AMOUNTOF $927.16 TO THE COMPLAINANT REFERENCED IN THE ORDER ANDPROVIDE THE DIRECTOR OF INSPECTIONS & COMPLIANCE DIVISION OFTHE TEXAS STATE SECURITIES BOARD EVIDENCE OF SUCH PAYMENT.


No



Initiated By: TEXAS STATE SECURITIES BOARD


Reprimand


ADMINISTRATIVE FINE





Allegations: IN FEBRUARY 2008, IMS RECEIVED A COMPLAINT FROM A CUSTOMER WHOSUFFERED A LOSS IN HIS ACCOUNT DUE TO A DELAY IN INVESTING FUNDSTHROUGH AN AGENT OF IMS. IMS DID NOT AMEND THE AGENT'S U4 TOREFLECT THE COMPLAINT. BY NOT UPDATING THE AGENT'S U4, IMSFAILED TO COMPLY WITH IT'S OWN WRITTEN PROCEDURES



Resolution:


Sanction Details: IMS SECURITIES, INC. PAID THE COMPLAINTANT REFERENCED IN THEORDER THE AMOUNT OF $927.16 AND PROVIDED PROOF OF PAYMENT TOTHE INSPECTIONS & COMPLIANCE DIVISION OF THE TEXAS STATESECURITIES BOARD.


Order






Sanction Details: IMS SECURITIES, INC. PAID THE COMPLAINTANT REFERENCED IN THEORDER THE AMOUNT OF $927.16 AND PROVIDED PROOF OF PAYMENT TOTHE INSPECTIONS & COMPLIANCE DIVISION OF THE TEXAS STATESECURITIES BOARD.

Disclosure 6 of 6

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Initiated By: TEXAS STATE SECURITIES BOARD




Docket/Case Number: CEN-1090


Principal Product Type:


Allegations: Not Provided



Resolution:


Sanction Details: ON MARCH 13,1996, THE SECURITIES COMMISSIONERENTERED AN ORDER AGAINST IMS SECURITIES, INC. DUE TO ANADMINISTRATIVE OVERSIGHT RESPONDENT AUTHORIZED ONE OF ITSAGENTS TO OFFER & SELL SECURITIES IN THE STATE OF TEXAS AT ATIME WHEN THE AGENT WAS NOT REGISTERED WITH THE SECURITIESCOMMISSIONER AS REQUIRED BY SECTION 12 OF THE TEXAS SECURITIESACT. PURSUANT TO SECTION 14 OF THE SECURITIES ACT RESPONDENT ISREPRIMANDED.

Regulator Statement CONTACT: JOYCE MILLER (512) 305-8390

Sanctions Ordered:

Order







Initiated By: STATE OF TEXAS


Reprimand



Docket/Case Number: CEN 1090

Principal Product Type: Mutual Fund(s)


Allegations: ALLOWING AGENT TO OFFER SALES OF SECURITIES WITHOUT BEINGREGISTERED IN TEXAS



Resolution:


Sanction Details: ON MARCH 13,1996, THE SECURITIES COMMISSIONER ENTERED ANORDER AGAINST IMS SECURITIES, INC. DUE TO AN ADMINISTRATIVEOVERSIGHT RESPONDENT AUTHORIZED ONE OF ITS AGENTS TO OFFER &SELL SECURITIES IN THE STATE OF TEXAS AT A TIME WHEN THE AGENTWAS NOT REGISTERED WITH THE SECURITIES COMMISSIONER ASREQUIRED BY SECTION 12 OF THE TEXAS SECURITIES ACT. PURSUANT TOSECTION 14 OF THE SECURITIES ACT RESPONDENT IS REPRIMANDED.

Sanctions Ordered:







Arbitration Award - Award / Judgment

Brokerage firms are not required to report arbitration claims filed against them by customers; however, BrokerCheckprovides summary information regarding FINRA arbitration awards involving securities and commodities disputesbetween public customers and registered securities firms in this section of the report. The full text of arbitration awards issued by FINRA is available at www.finra.org/awardsonline.

Disclosure 1 of 3


Type of Event: ARBITRATION

Arbitration Forum:

Case Initiated:

Case Number:

Allegations:

Disputed Product Type:

Sum of All Relief Requested:

Disposition:

Disposition Date:

Sum of All Relief Awarded:

FINRA

02/11/2010

10-00556

ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSIONOF FACTS; ACCOUNT RELATED-BREACH OF CONTRACT; ACCOUNTRELATED-FAILURE TO SUPERVISE; ACCOUNT RELATED-NEGLIGENCE

OTHER TYPES OF SECURITIES

$100,000.00

AWARD AGAINST PARTY

04/10/2012

$5,236.84

There may be a non-monetary award associated with this arbitration.Please select the Case Number above to view more detailed information.

Disclosure 2 of 3

i



Arbitration Forum:

Case Initiated:

Case Number:

Allegations:

FINRA

05/19/2016

16-01390

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OTHER; ACCOUNT RELATED-BREACH OF CONTRACT; ACCOUNT RELATED-FAILURE TO SUPERVISE;ACCOUNT RELATED-NEGLIGENCE





www.finra.org/awardsonline

https://www.finra.org/arbitration-and-mediation/arbitration-awards-online?search=10-00556



Case Number:



Disposition:

Disposition Date:


16-01390

OTHER TYPES OF SECURITIES

$144,000.00

AWARD AGAINST PARTY

04/05/2017

$20,250.00


Disclosure 3 of 3

i



Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


FINRA

07/11/2016

16-01800

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSION OF FACTS;ACCOUNT RELATED-BREACH OF CONTRACT; ACCOUNT RELATED-FAILURETO SUPERVISE; ACCOUNT RELATED-NEGLIGENCE

LIMITED PARTNERSHIPS; VARIABLE ANNUITIES

$3,000,000.00

AWARD AGAINST PARTY

11/01/2017

$1,322,216.06









End of Report

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