Lighthouse Wealth Strategies, Llc

Allegations: FINRA RULE 2010, NASD RULES 2110, 2370, 3030 - MARTY E. PAUL ENGAGED IN OUTSIDE BUSINESS ACTIVITIES WITHOUT PROVIDING PROMPT WRITTEN NOTICE TO HIS MEMBER FIRM; PAUL OWNED AND OPERATED REAL ESTATE DEVELOPMENT COMPANIES WHICH HE DID NOT DISCLOSE TO HIS FIRM. PAUL PROVIDED INACCURATE INFORMATION TO HIS FIRM WHEN HE DISCLOSED HIS OUTSIDE BUSINESS ACTIVITIES. HE WROTE HE WAS A PASSIVE OWNER OF ONE COMPANY WHEN HE WAS ACTUALLY AN ACTIVE OWNER. HE WROTE HE WAS A PASSIVE 50% OWNER OF ANOTHER FIRM WHEN HE ACTUALLY OWNED 100% AND WAS AN ACTIVE OWNER. HE WROTE HE WAS A PASSIVE PARTNER IN A THIRD COMPANY WHEN HE WAS AN ACTIVE OWNER. HE WROTE HE WAS A PASSIVE OWNER OF A FOURTH COMPANY AND THAT A CUSTOMER WAS ALSO AN OWNER WHEN HE WAS AN ACTIVE OWNER AND OWNED 100% OF THE COMPANY. PAUL AND ONE OF HIS COMPANIES BORROWED $6,500,000 FROM A CUSTOMER, SECURED BY A DEED OF TRUST, TO FINANCE A COMMERCIAL REAL ESTATE PROJECT CONTRARY TO HIS FIRM'S WRITTEN SUPERVISORY PROCEDURES PROHIBITING A REGISTERED REPRESENTATIVE FROM BORROWING MONEY FROM A CUSTOMER UNLESS THE CUSTOMER WAS A MEMBER OF THE REPRESENTATIVE'S IMMEDIATE FAMILY OR WAS REGULARLY ENGAGED IN THE BUSINESS OF LENDING MONEY OR PROVIDING CREDIT TO THE GENERAL PUBLIC WHICH THE CUSTOMER WAS NOT. IN A COMPLIANCE QUESTIONNAIRE, PAUL INACCURATELY STATED HE HAD NEVER BORROWED FROM OR LENT MONEY TO ANY CLIENTS; IN AN EMAIL, PAUL WROTE THAT HE CUSTOMER WAS A NON-PARTNER INVESTOR WHEN HE HAD ACTUALLY MADE A LOAN TO PAUL AND HIS COMPANY. WHEN REPRESENTATIVES INQUIRED WHETHER PAUL HAD BORROWED MONEY, HE DENIED THAT HE OR HIS COMPANY HAD BORROWED MONEY AND THE CUSTOMER WAS AN INVESTOR. IN AN EMAIL, PAUL WROTE THAT HIS COMPANY OWNED THE LAND FOR THE PROJECT AND THAT THE CUSTOMER WAS THE OWNER OF THE IMPROVEMENTS WHICH WERE COMPLETELY SEPARATE WHEN THE COMPANY ACTUALLY OWNED BOTH THE LAND AND THE IMPROVEMENTS AND THE CUSTOMER HAD MADE A LOAN TO FINANCE THE DEVELOPMENT AND CONSTRUCTION OF THE PROJECT. Status: Final Sanction Detail: MR. PAUL WAS SUSPENDED FOR ONE YEAR BEGINNING 05/07/2012 AND ENDING ON 05/06/2013 AS AN INVESTMENT ADVISOR REPRESENTATIVE AND A BROKER DEALER SALESPERSON. A FINE OF $20,000.00 WAS ASSESSED AND PAYABLE UPON HIS RE-ASSOCIATION WITH A MEMBER FIRM. Summary: WITHOUT ADMITTING OR DENYING THE FINDINGS, MR. PAUL CONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF THE FINDINGS. HE WAS SUSPENDED FROM ASSOCIATION WITH ANY FINRA MEMBER IN ANY CAPACITY FOR ONE YEAR BEGINNING 05/07/2012 AND ENDING 05/06/2013. HE WAS ALSO FINED $20,000.00 PAYABLE UPON HIS RE-ASSOCIATION WITH A MEMBER FIRM.

Allegations: ON JANUARY 13, 2014, THE SECURITIES DIVISION ENTERED A STATEMENT OF CHARGES AND NOTICE OF INTENT TO ENTER ORDER TO CEASE AND DESIST, REVOKE REGISTRATION, DENY FUTURE REGISTRATION APPLICATIONS, IMPOSE A FINE, AND CHARGE COSTS (STATEMENT OF CHARGES) AGAINST MARTY EDWARD PAUL, AKA MARTIN PAUL (PAUL). THE STATEMENT OF CHARGES ALLEGES THAT PAUL BORROWED $6.5 MILLION FROM A CLIENT, PROVIDED FALSE INFORMATION TO HIS FIRM ABOUT HIS OUTSIDE BUSINESS ACTIVITIES, INTRODUCED CLIENTS TO INVESTMENTS AWAY FROM HIS FIRM, AND PROVIDED FALSE INFORMATION TO THE FIRM ABOUT HIS OUTSIDE INVESTMENTS. THE STATEMENT OF CHARGES ALLEGES THAT PAUL WAS TERMINATED BY HIS FIRM FOR BORROWING THE MONEY FROM HIS CLIENT, AND THAT HE WAS SANCTIONED BY FINRA FOR BORROWING THE MONEY FROM HIS CLIENT AND PROVIDING INACCURATE INFORMATION TO HIS FIRM ABOUT THE LOAN AND HIS OUTSIDE BUSINESS ACTIVITIES. FURTHER, THE STATEMENT OF CHARGES ALLEGES THAT PAUL MISREPRESENTED HIS TERMINATION AND THE REGULATORY HISTORY TO THE SECURITIES DIVISION. Status: Final Sanction Detail: MR. PAUL WAS BARRED (TIME LIMITED) AS AN INVESTMENT ADVISOR REPRESENTATIVE, BROKER DEALER SALESPERSON FOR A PERIOD OF EIGHTEEN MONTHS BEGINNING 08/01/2014 AND ENDING 01/31/2016 Summary: WITHOUT ADMITTING OR DENYING THE STATE'S ALLEGATIONS, MR. PAUL AGREED TO CEASE AND DESIST FROM VIOLATING THE SECURITIES ACT OF WASHINGTON. MR. PAUL PAID AN ADMINISTRATIVE FINE OF $20,000.00, AND INVESTIGATIVE COST OF $4,500.00. FURTHER MR. PAUL AGREED TO AN 18 MONTH BAR FROM 08/01/2014 TO 01/31/2016 AS A INVESTMENT ADVISOR REPRESENTATIVE OR BROKER DEALER SALES PERSON