UNITED STATES SECURITIES AND EXCHANGE COMMISSION

The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Section 203(f) of the Investment Advisers Act of 1940 ("Advisers Act") against Kerry L. Hoffman ("Respondent" or "Hoffman"). The Commission finds that from March 2015 through May 2018, Hoffman acted as a business and financial advisor to GT Media, Inc. ("GT Media"), a company that operated under the name "Joy of Mom" in Deerfield, Illinois. From February 2010 through September 2018, Hoffman also worked as a registered representative and an investment advisory representative in the Chicago, Illinois office of a broker-dealer and investment adviser ("Adviser A") dually registered with the Commission. On January 8, 2021, a final judgment was entered by consent against Hoffman, permanently enjoining him from future violations of Section 17(a)(2) and 17(a)(3) of the Securities Act of 1933 ("Securities Act"), Section 15(a) of the Exchange Act, and Section 206(2) of the Advisers Act, in the civil action entitled Securities and Exchange Commission v. Thomas V. Conwell, et al., Civil Action Number 19-cv-4409, in the United States District Court for the Northern District of Illinois. The Commission's complaint alleged that between August 2015 and January 2018, Hoffman, without informing Adviser A, sold GT Media stock and promissory notes to his advisory clients outside of their accounts at Adviser A. The complaint also alleged that Hoffman received compensation from GT Media and made several short-term loans to GT Media when the company had run out of money. It further alleged that the loans were repaid to Hoffman using funds that the company received from one of Hoffman's advisory clients. According to the complaint, Hoffman failed to inform his advisory clients of his significant conflicts of interest, including that he was compensated as an advisor to GT Media, he was receiving commissions on their investments in GT Media stock, and that he had loaned money to GT Media. The complaint also alleged that Hoffman acted as an unregistered broker.

Order

Bar (Permanent)

Association with a broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or NRSRO.

Indefinite

with a right to reapply to the SEC after five years.

1/11/2021

Participating in any offering of a penny stock, including: acting as a promoter, finder, consultant, or agent.

Indefinite

with a right to reapply to the SEC after five years.

1/11/2021

CLAIMANTS, NONE OF WHOM WERE EVER CUSTOMERS OF LPL, ALLEGE THAT ADVISOR SOLD THEM AN UNREGISTERED SECURITY. ACTIVITY PERIOD: 1/2016 TO 5/2018 APPROXIMATELY.

$75,000.00

CLAIMANTS ALLEGE THAT THEIR ADVISOR RECOMMENDED AN UNSUITABLE, NON-REGISGTERED SECURITY. ACTIVITY PERIOD: 1/26/16 TO 3/29/16.

$100,000.00

$56,950.00

CLAIMANTS ALLEGE THAT THEIR ADVISOR RECOMMENDED AN UNSUITABLE, NON-REGISTERED SECURITY. ACTIVITY PERIOD - 2016 TO 2018.

$320,000.00

$105,860.00

CLAIMANTS ALLEGE THAT THEIR ADVISOR RECOMMENDED AN UNSUITABLE, NON-REGISTERED SECURITY. DECEMBER 2015 TO NOVEMBER 2016.

$170,000.00

$92,292.50

CLAIMANTS ALLEGE THAT THEIR ADVISOR RECOMMENDED AN UNSUITABLE, NON-REGISTERED SECURITY. ACTIVITY PERIOD - JUNE 2015 TO MARCH 2017.

$420,000.00

$219,843.75

CLAIMANTS ALLEGE THAT THEIR ADVISOR RECOMMENDED AN UNSUITABLE, UNREGISTERED SECURITY AND RECOMMENDED THE LIQUIDATION OF AN ANNUITY. ACTIVITY PERIOD - APRIL 2017 TO JULY 2018.

$61,053.75

CLAIMANTS, WHO WERE NEVER CUSTOMERS OF LPL, ALLEGE THE ADVISOR (IN DECEMBER 2017) SOLD THEM A FRAUDULENT, UNREGISTERED SECURITY. ACTIVITY PERIOD: MARCH 2016 TO MAY 2018.

$550,000.00

$301,500.00

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

SEC Litigation Release 24526, July 1, 2019: The SEC's complaint alleges that Hoffman raised over $3.3 million from approximately 46 investors through the sale of unregistered GT Media, Inc. securities. According to the complaint, Hoffman solicited certain of his advisory clients to invest in GT Media securities without disclosing his financial conflicts of interest, including his compensation from GT Media and his short-term loans to GT Media that were repaid using investor funds. The SEC's complaint charges Hoffman with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and the broker-dealer registration provisions of Section 15(a) of the Exchange Act. The complaint also charges Hoffman with violating the antifraud provisions of Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. The SEC requests that the court Permanently restrain and enjoin Hoffman from, directly or indirectly, violating Sections 17(a)(1), 17(a)(2), and 17(a)(3) of the Securities Act, Sections 10(b) and 15(a) of the Exchange Act and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Advisers Act, Order Hoffman to disgorge his ill-gotten gains directly or indirectly received as a result of the violations alleged in this Complaint, with prejudgment interest thereon, and order Hoffman to pay civil penalties.

Judgment Rendered

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

Disgorgement

$60,000.00

Monetary Penalty other than Fines

Injunction

Union Capital Company

Permitted to Resign

Failure to Fully Disclose

LPL Financial LLC

Voluntary Resignation

Held a private investment and executed an agreement to act as a Consultant to a company without disclosing or obtaining prior approval from LPL. Assisted some family members and a few clients with making investments in same company.

Uncontested

UBS FINANCIAL SERVICES INC.

Discharged

AN EMPLOYEE ALLEGED THAT MR. HOFFMAN ENTERED TRADES WITHOUT OBTAINING PROPER WRITTEN AUTHORIZATION.

CUSTOMER VERIFIED HE BELIEVED PROPER WRITTEN AUTHORIZATION WAS ON FILE. TRANSITION RELATED OCCURANCE. UBS BOUGHT MCDONALD INVESTMENTS. CLIENT AND BROKER BELIEVED WRITTEN AUTHORIZATION WAS WITH PRIOR FIRM. ONCE IDENTIFIED, WRITTEN AUTHORIZATION WAS AGAIN OBTAINED FOR THE FILE.

CLIENT ALLEGES THAT FINANCIAL ADVISOR MADE MISREPRESENTATION TO THEM CONCERNING THE SAFETY OF THEIR INVESTMENT N A VARIABLE ANNUITY.

$11,000.00