Attorney General Jennifer Davenport and the New Jersey Bureau of Securities announced on Mar. 11 that Network 1 Financial Securities, Inc., a broker-dealer based in Red Bank, has agreed to pay a $375,000 civil penalty and implement corrective measures after an investigation found failures in its anti-money laundering and supervisory procedures.
The announcement highlights the importance of strong oversight in financial markets to protect investors from illegal conduct and market manipulation. According to the official website, the New Jersey Attorney General Matthew Platkin aims to protect residents’ lives and property, uphold legal standards, and deliver statewide enforcement and legal support according to the official website.
The Bureau’s investigation found that Network 1 did not have adequate procedures for anti-money laundering or customer identification. The firm also failed to perform reasonable due diligence on companies whose shares it offered in private placements. “Investors work hard to build financial security and plan for an affordable future. But those investments are jeopardized when firms ignore their duty to protect the market from illegal conduct, manipulation, and abuse,” said Attorney General Davenport. She added that her office will ensure compliance with laws requiring strong supervision.
Jeremy E. Hollander, Acting Director of the Division of Consumer Affairs, said: “For many people, every dollar invested represents years of hard work and careful planning. New Jersey’s financial markets must be kept fair, transparent, and trustworthy—so investors can participate with confidence and security. Today’s announcement demonstrates the Division’s continuing commitment to that goal.” Bureau Chief Keith A. Alt said: “Broker-dealers and their agents perform the critical role of gatekeepers in our financial markets… When those safeguards break down, investors and market integrity are placed at risk.”
Network 1 was previously censured by the Financial Industry Regulatory Authority (FINRA) in March 2025 with a $400,000 fine and required oversight by a third-party consultant. The new Consent Order requires this consultant to report on Network 1’s implementation of recommendations related both to FINRA’s findings and those uncovered by the Bureau’s investigation.
According to the official website, the New Jersey Attorney General Matthew Platkin extends its services throughout all counties in New Jersey according to the official website, influences public safety through law enforcement oversight according to the official website, holds authority over prosecution of offenses according to the official website, offers consumer protection initiatives according to the official website, and functions as a state agency focused on justice across New Jersey according to the official website.
As part of remedial actions under this order, Michael Molinaro has been relieved from his roles as Chief Compliance Officer and Anti-Money Laundering Compliance Officer at Network 1; he will not return to any supervisory or compliance positions within the firm.
