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What changed in SIEBERT FINANCIAL CORP's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of SIEBERT FINANCIAL CORP's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+230 added−220 removedSource: 10-K (2024-05-10) vs 10-K (2023-03-29)

Top changes in SIEBERT FINANCIAL CORP's 2023 10-K

230 paragraphs added · 220 removed · 159 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

50 edited+5 added−4 removed44 unchanged
Biggest changeWe operate our Securities Finance Group, a division which consists primarily of our stock borrow / stock loan and related services. Our management team brings decades of securities finance experience and we have seen positive results in recent years and are committed to continue to expand our securities finance operations.
Biggest changeMSCO is a self-clearing broker-dealer and also clears with National Financial Services Corp. (“NFS”), a wholly-owned subsidiary of FMR, LLC. Securities Finance and Market Making We operate our Securities Finance Group, which is a division that consists primarily of our stock borrow / stock loan and related services. Our management team brings decades of securities finance experience to this division.
In permitting customers to engage in margin financing, short sale or any other transaction, MSCO assumes the risk of its customers’ failure to meet their obligations in the event of adverse changes in the market affect the value of the margined securities positions.
In permitting customers to engage in margin financing, short sale or any other transaction, MSCO assumes the risk of its customers’ failure to meet their obligations in the event adverse changes in the market affect the value of the margined securities positions.
Regulation Best Interest Rules have impacted the conduct of our business, especially with respect to our business with our retail clients. The need for enhanced documentation for recommendations of securities transactions to broker-dealer retail clients as well as the increased supervision of sales practices and transactions increased the amount of record-keeping and training for our sales staff.
The Regulation Best Interest Rules have impacted the conduct of our business, especially with respect to our business with our retail clients. The need for enhanced documentation for recommendations of securities transactions to broker-dealer retail clients as well as the increased supervision of sales practices and transactions increased the amount of record-keeping and training for our sales staff.
As a result, we are subject to numerous laws and regulations designed to protect this information, such as U.S. federal and state laws governing the protection of personally identifiable information. These laws and regulations are increasing in complexity and number, change frequently and sometimes conflict.
As a result, we are subject to numerous laws and regulations designed to protect this information, such as U.S. federal and state laws and regulations governing the protection of personally identifiable information. These laws and regulations are increasing in complexity and number, change frequently and sometimes conflict.
For non-directed client orders, it is our policy to route orders to market centers based on a number of factors that are more fully discussed in the Supplemental Materials of FINRA Rule 5310, including, where applicable, but not necessarily limited to, speed of execution, price improvement opportunities, differences in price dis-improvement, likelihood of executions, the marketability of the order, size guarantees, service levels and support, the reliability of order handling systems, client needs and expectations, transaction costs, and whether the firm will receive remuneration for routing order flow to such market centers.
For non-directed client orders, it is our policy to route orders to market centers based on a number of factors that are more fully discussed in the Supplemental Materials of FINRA Rule 5310, including, where applicable, but not necessarily limited to, speed of execution, price improvement opportunities, differences in price dis-improvement, likelihood of execution, the marketability of the order, size guarantees, service levels and support, the reliability of order handling systems, client needs and expectations, transaction costs, and whether the firm will receive remuneration for routing order flow to such market centers.
SIPC is principally funded through assessments on registered broker-dealers. MSCO purchased $50 million additional account protection above SIPC coverage. Equities, bonds, mutual funds and money market funds are included at net asset value for purposes of SIPC protection and the additional protection. Neither SIPC protection nor the additional protection insures against fluctuations in the market value of securities.
SIPC is principally funded through assessments on registered broker-dealers. MSCO has purchased $50 million additional account protection above SIPC coverage. Equities, bonds, mutual funds and money market funds are included at net asset value for purposes of SIPC protection and the additional protection. Neither SIPC protection nor the additional protection insures against fluctuations in the market value of securities.
The regulations to which broker-dealers are subject cover all aspects of the securities business, including training of personnel, sales methods, trading practices among broker-dealers, uses and safekeeping of customers’ funds and securities, capital structure of securities firms, record keeping, fee arrangements, disclosure to clients, and the conduct of directors, officers and employees.
The regulations to which broker-dealers are subject cover all aspects of the securities business, including training and supervision of personnel, sales methods, trading practices among broker-dealers, uses and safekeeping of customers’ funds and securities, capital structure of securities firms, record keeping, fee arrangements, disclosure to clients, and the conduct of directors, officers and employees.
Customer service personnel, located in MSCO’s branch offices, are cross trained to assist with all clients’ needs for a reliable experience. MSCO uses a variety of customer relationship management systems that enables representatives in any location to review and respond to customers’ requests in a timely manner. Retirement Accounts MSCO offers customers a variety of self-directed retirement accounts.
Customer service personnel, located in MSCO’s branch offices, are cross trained to assist with all clients’ needs for a reliable experience. MSCO uses a variety of customer relationship management systems that enable representatives in any location to review and respond to customers’ requests in a timely manner. Retirement Accounts MSCO offers customers a variety of self-directed retirement accounts.
Corporate Services We are dedicated to helping publicly traded companies and their employees manage their equity compensation plans. Corporate services is a key component of our business, and we leverage our technology partnerships to create a distinct advantage through FIX connection trading and real-time transaction reporting. Our corporate services offering primarily supports small and mid-cap public companies.
Corporate Services We are dedicated to helping publicly traded companies and their employees manage their equity compensation plans. Corporate services is a key component of our business, and we leverage our technology partnerships to create a distinct advantage through FIX connection trading and real-time transaction reporting. Siebert Corporate Services primarily supports small and mid-cap public companies.
The SEC is authorized to institute proceedings and impose sanctions for violations of the Advisers Act, ranging from fines and censures to termination of an adviser’s registration and, in the case of willful violations, can refer a matter to the Unites States Department of Justice for criminal prosecution.
The SEC is authorized to institute proceedings and impose sanctions for violations of the Advisers Act, ranging from fines and censures to termination of an adviser’s registration and, in the case of willful violations, can refer a matter to the United States Department of Justice for criminal prosecution.
Securities firms are also subject to regulation by state securities authorities in the states in which they do business. MSCO is registered as a broker-dealer in 50 states, the District of Columbia, and Puerto Rico, and RISE is registered as a broker-dealer in 22 states and territories.
Securities firms are also subject to regulation by state securities authorities in the states in which they do business. MSCO is registered as a broker-dealer in 50 states, the District of Columbia, and Puerto Rico, and RISE is registered as a broker-dealer in 7 states and territories.
Based upon the strategic direction of these ventures, management of the respective businesses decided to unwind the original transactions with Siebert, RISE, Hedge Connection and Tigress. See Note 3 – Transactions with Tigress and Hedge Connection for further detail on these transactions.
In 2023, based upon the strategic direction of these ventures, management of the respective businesses decided to unwind the original transactions with Siebert, RISE, Hedge Connection and Tigress. See Note 3 – Transactions with Tigress and Hedge Connection for further detail on these transactions.
SIPC As a registered broker-dealer and FINRA member organization, MSCO is required by federal law to belong to the SIPC which provides, in the event of the liquidation of a broker-dealer, protection for securities held in customer accounts held by the firm of up to $500,000 per customer, subject to a limitation of $250,000 on claims for cash balances.
SIPC As a registered broker-dealer and FINRA member organization, MSCO and RISE are required by federal law to belong to SIPC which provides, in the event of the liquidation of a broker-dealer, protection for securities held in customer accounts held by the firm of up to $500,000 per customer, subject to a limitation of $250,000 on claims for cash balances.
These regulations affect our business operations and impose capital, client protection, and market conduct requirements. Conduct and Training The principal purpose of regulation and discipline of broker-dealers is the protection of customers and the securities markets.
These regulations affect our business operations and impose capital, client protection, and market conduct requirements, among others. Conduct and Training The principal purpose of regulation and discipline of broker-dealers is the protection of customers and the securities markets.
Additional legislation, changes in rules promulgated by the SEC and by SROs or changes in the interpretation or enforcement of existing laws and rules may directly affect the method of operation and profitability of broker-dealers.
Additional legislation, changes in rules promulgated by the SEC and by SROs and/or changes in the interpretation or enforcement of existing laws and rules may directly affect the methods of operation and profitability of broker-dealers.
Our common stock, par value $.01 per share trades on the Nasdaq Capital Market under the symbol “SIEB.” Subsidiaries and Business Offerings Muriel Siebert & Co., Inc. Overview MSCO has been providing online and traditional discount brokerage services to clients for over 50 years. MSCO was founded in 1967 by Muriel F.
Our common stock, par value $.01 per share trades on the Nasdaq Capital Market under the symbol “SIEB.” Subsidiaries and Business Offerings Muriel Siebert & Co., LLC. Overview MSCO has been providing online and traditional discount brokerage services to clients for over 55 years. MSCO was founded in 1967 by Muriel F.
STCH is a Nevada limited liability company. ​​ • RISE Financial Services, LLC, (“RISE”) is a Delaware limited liability company and a broker-dealer registered with the SEC and NFA. • StockCross Digital Solutions, Ltd. (“STXD”) is an inactive subsidiary headquartered in Bermuda.
STCH is a Nevada limited liability company. ● RISE Financial Services, LLC, (“RISE”) is a Delaware limited liability company and a broker-dealer registered with the SEC, CFTC, FINRA, SIPC and NFA. ● StockCross Digital Solutions, Ltd. (“STXD”) is an inactive subsidiary headquartered in Bermuda.
Products and Services • Self-directed trading • Market making and fixed income investments • Stock borrow / stock loan • Equity compensation plans (Siebert Corporate Services) • Wealth management / financial advice Siebert 2022 Form-10K 2 Additional Information Brokerage and Related Services MSCO offers a wide selection of quality investment services, including broker assisted trades and free online self-service features such as real time quotes, market data, and trading tools.
Siebert 2023 Form-10K 2 Products and Services MSCO offers a wide range of products and services, including the following: ● Self-directed trading ● Market making and fixed income investments ● Stock borrow / stock loan ● Equity compensation plans (Siebert Corporate Services) ● Wealth management / financial advice Additional Information Brokerage and Related Services MSCO offers a wide selection of quality investment services, including broker assisted trades and free online self-service features such as real time quotes, market data, and trading tools.
(“SNXT”) provides investment advisory services. SNXT is a New York corporation registered with the SEC as a Registered Investment Advisor (“RIA”) under the Investment Advisers Act of 1940 (“Advisers Act”). • Park Wilshire Companies, Inc. (“PW”) provides insurance services. PW is a Texas corporation and licensed insurance agency • Siebert Technologies, LLC. (“STCH”) provides robo-advisory technology development.
SNXT is a New York corporation registered with the SEC as a Registered Investment Advisor (“RIA”) under the Investment Advisers Act of 1940 (“Advisers Act”), and the CFTC. ● Park Wilshire Companies, Inc. (“PW”) provides insurance services. PW is a Texas corporation and licensed insurance agency. ● Siebert Technologies, LLC (“STCH”) provides technology development.
MSCO and RISE send client orders to a number of market centers, including market makers and exchanges, which encourages competition and ensures redundancy.
MSCO and RISE send client orders for execution to a number of market centers, including market makers and exchanges, which encourages competition and ensures redundancy.
To the extent they are applicable to us, we must comply with federal and state information-related laws and regulations in the United States, including the Gramm-Leach-Bliley Act of 1999, SEC Regulation S-P, the Fair Credit Reporting Act of 1970, as amended, and Regulation S-ID, as well as the California Consumer Protection Act and further potential federal and state requirements.
To the extent they are applicable to us, we must comply with federal and state information-related laws and regulations in the United States, including the Gramm-Leach-Bliley Act of 1999, SEC Regulation S-P, the Fair Credit Reporting Act of 1970, as amended, and Regulation S-ID (the Identity Theft Red Flags Rule), as well as the California Consumer Protection Act and further potential federal and state requirements.
MSRB MSCO is also authorized by the Municipal Securities Rulemaking Board (“MSRB”) to affect transactions in municipal securities on behalf of its customers and has obtained certain additional registrations with the SEC and state regulatory agencies necessary to permit it to engage in certain other activities incidental to its brokerage business.
Siebert 2023 Form-10K 6 MSRB MSCO is also authorized by the Municipal Securities Rulemaking Board (“MSRB”) to affect transactions in municipal securities on behalf of its customers and has obtained certain additional registrations with the SEC and state regulatory agencies necessary to permit it to engage in certain other activities incidental to its brokerage business.
Siebert 2022 Form-10K 7 Bank Secrecy Act of 1970 We conduct financial services activities that are subject to the Bank Secrecy Act of 1970 (“BSA”), as amended by the USA PATRIOT Act of 2001 (“PATRIOT Act”), which require financial institutions to develop and implement programs reasonably designed to achieve compliance with these regulations.
Bank Secrecy Act of 1970 We conduct financial services activities that are subject to the Bank Secrecy Act of 1970 (“BSA”), as amended by the USA PATRIOT Act of 2001 (“PATRIOT Act”), which require financial institutions to develop and implement programs reasonably designed to achieve compliance with these regulations.
These transactions are serviced by MSCO’s registered representatives. Retail Customer Service MSCO believes that its superior customer service enhances its ability to compete with larger brokerage firms and provides retail customers with personal service via access to dedicated customer service personnel for all of its products and services.
These transactions are serviced by MSCO’s registered representatives. Siebert 2023 Form-10K 3 Retail Customer Service MSCO believes that its superior customer service enhances its ability to compete with larger brokerage firms and provides retail customers with personal service via access to dedicated customer service personnel for all of its products and services.
Siebert 2022 Form-10K 8 To maintain a high-caliber, values-driven workforce that is committed to our culture, we strive to offer total rewards, including compensation and benefits that position our company as an employer of choice.
To maintain a high-caliber, values-driven workforce that is committed to our culture, we strive to offer total rewards, including compensation and benefits that position our company as an employer of choice.
MSCO is a member of the NYSE and the FINRA. Much of the regulation of broker-dealers has been delegated to self-regulatory organizations (“SROs”), principally FINRA, which is MSCO’s and RISE’s primary regulator with respect to financial and operational compliance. These SROs adopt rules (subject to approval by the SEC) governing the industry and conduct periodic examinations of broker-dealers.
Much of the regulation of broker-dealers has been delegated to self-regulatory organizations (“SROs”), principally FINRA, which is MSCO’s and RISE’s primary regulator with respect to financial and operational compliance. These SROs adopt rules (subject to approval by the SEC) governing their members and conduct periodic examinations of broker-dealers.
Net Capital As registered broker-dealers, MSCO and RISE are subject to the requirements of the Exchange Act relating to broker-dealers such as minimum net capital requirements under the SEC Uniform Net Capital Rule (Rule 15c3-1) and segregation of fully paid client funds and securities under the SEC Customer Protection Rule (Rule 15c3-3), administered by the SEC and FINRA.
Siebert 2023 Form-10K 7 Net Capital As registered broker-dealers, MSCO and RISE are subject to the requirements of the Exchange Act and the rules thereunder relating to broker-dealers, such as minimum net capital requirements under the SEC Uniform Net Capital Rule (Rule 15c3-1) and segregation of fully paid client funds and securities under the SEC Customer Protection Rule (Rule 15c3-3), administered by the SEC and FINRA.
Regulation Best Interest Pursuant to the Dodd-Frank Act, the SEC was charged with considering whether broker-dealers should be subject to a standard of care similar to the fiduciary standard applicable to RIAs.
Regulation Best Interest Pursuant to the Dodd-Frank Act, the SEC was charged with considering whether broker-dealers should be subject to a standard of care similar to the fiduciary standard applicable to registered investment advisers (“RIAs”).
The related new rules and procedures have and may continue to bring increased costs associated with compliance and enhanced technology. Siebert 2022 Form-10K 6 We operate pursuant to Regulation Best Interest Rules and as such, we conducted thorough training of all our employees with respect to the requirements of Regulation Best Interest.
The related new rules and procedures have and may continue to bring increased costs associated with compliance and enhanced technology. We operate pursuant to the Regulation Best Interest Rules and as such, we conduct thorough training of all our employees with respect to the requirements of Regulation Best Interest.
MSCO is a Delaware corporation and broker-dealer registered with the Securities and Exchange Commission (“SEC”) under the Securities Exchange Act of 1934 (“Exchange Act”) and the Commodity Exchange Act of 1936, and member of the Financial Industry Regulatory Authority (“FINRA”), the New York Stock Exchange (“NYSE”), the Securities Investor Protection Corporation (“SIPC”), Euroclear, and the National Futures Association (“NFA”). • Siebert AdvisorNXT, Inc.
MSCO is a Delaware corporation and broker-dealer registered with the SEC under the Securities Exchange Act of 1934 (“Exchange Act”) and the Commodity Exchange Act of 1936, and member of the Financial Industry Regulatory Authority (“FINRA”), the New York Stock Exchange (“NYSE”), the Securities Investor Protection Corporation (“SIPC”), Euroclear, and the National Futures Association (“NFA”), and the Commodities Futures Trading Commission (“CFTC”). ● Siebert AdvisorNXT, LLC (“SNXT”) provides investment advisory services.
For purposes of this Annual Report, the terms “Siebert,” “Company,” “we,” “us” and “our” refer to Siebert Financial Corp., MSCO, SNXT, PW, STCH, RISE, and STXD collectively, unless the context otherwise requires. Our headquarters are located at 535 Fifth Avenue, 4 th Floor, New York, NY 10017, with primary operations in New Jersey, Florida, and California.
For purposes of this Annual Report, the terms “Siebert,” “Company,” “we,” “us” and “our” refer to Siebert Financial Corp., MSCO, SNXT, PW, STCH, RISE, and STXD collectively, unless the context otherwise requires. Our headquarters is located at 653 Collins Avenue, Miami Beach, FL 33139, with primary operations in New Jersey, Florida and California.
Siebert 2022 Form-10K 3 Information and Communications Systems MSCO relies heavily on its data technology platform and the platform provided by its clearing agents. These platforms offer interfaces to MSCO’s clearing service providers’ computing systems where all customer account records are kept and are accessible through MSCO’s data technology platform.
Information and Communications Systems MSCO relies heavily on its data technology platform and the platform provided by its clearing agents. These platforms offer interfaces to MSCO’s clearing service providers’ computing systems where all customer account records are kept and are accessible through MSCO’s data technology platform. MSCO’s systems also utilize browser-based access and other types of data communications.
Margin Lending Margin lending activities are subject to limitations imposed by regulations of the Federal Reserve System and FINRA. In general, these regulations provide that, in the event of a significant decline in the value of securities collateralizing a margin account, we are required to obtain additional collateral from the borrower or liquidate securities positions.
In general, these regulations provide that, in the event of a significant decline in the value of securities collateralizing a margin account, we are required to obtain additional collateral from the borrower or liquidate securities positions.
Our firm is characterized by building solid relationships with our clients through exceptional personal service and proven performance. We have a strong legacy and continue to evolve in our approach to take advantage of ever-evolving opportunities in the financial services industry. We conduct the following lines of business through our wholly-owned and majority-owned subsidiaries: • Muriel Siebert & Co., Inc.
Our firm is characterized by building solid relationships with our clients through exceptional personal service and proven performance. We have a strong legacy and continue to evolve in our approach to take advantage of opportunities in the financial services industry.
In June 2019, the SEC adopted a package of rulemakings and interpretations related to the provision of advice by broker-dealers and investment advisers, including Regulation Best Interest and Form CRS.
In June 2019, the SEC adopted a package of rules and interpretations related to the provision of advice by broker-dealers and investment advisers, including Regulation Best Interest and Form CRS (collectively, these regulations, rules and interpretations are referred to herein as the “Regulation Best Interest Rules”).
The robo-advisor continuously monitors and periodically rebalances portfolios to address changes in market and economic conditions. Products and Services • Managed portfolios • Separately managed accounts Park Wilshire Companies, Inc. Overview PW is a full-service insurance agency founded in 2010. Through PW our product offerings include various insurance products such as fixed annuities and property and casualty insurance.
Products and Services The products and services offered by SNXT include: ● Managed portfolios ● Separately managed accounts Park Wilshire Companies, Inc. Overview PW is a full-service insurance agency founded in 2010. Through PW, our product offerings include various insurance products such as fixed annuities and property and casualty insurance.
MSCO’s data technology platform offers services used in direct relation to customer activities as well as support for corporate use. Some of these services include email and messaging, market data systems and third-party trading systems, business productivity tools and customer relationship management systems. MSCO’s data network is designed with redundancies in case a significant business disruption occurs.
Some of these services include email and messaging, market data systems and third-party trading systems, business productivity tools and customer relationship management systems. MSCO’s data network is designed with redundancies in case a significant business disruption occurs.
The SEC has legal authority to inspect any investment adviser and typically inspects a RIA periodically to determine whether the adviser is conducting its activities in compliance with (i) applicable laws and regulations, (ii) disclosures made to clients and (iii) adequate systems, policies and procedures reasonably designed to prevent and detect violations.
The SEC has legal authority to examine any RIA and, depending upon the type of exam, may review the examined RIAs to determine whether the adviser is conducting its activities in compliance with (i) applicable laws and regulations, (ii) disclosures made to clients and (iii) adequate systems, policies and procedures reasonably designed to prevent and detect violations of the Advisers Act.
We are consistently enhancing technology for both our customers as well as our internal operations. We are currently in the process of enhancing our retail trading platform to provide a seamless user experience for our customers and streamline our operations. Siebert AdvisorNXT, Inc.
We are consistently enhancing technology for both our customers as well as our internal operations. We are currently in the process of developing a new retail platform (“Retail Platform”) for our customers and integrating the trading platform into our operations. Siebert 2023 Form-10K 4 Siebert AdvisorNXT, Inc.
We compete with a wide variety of vendors of financial services for the same customers; however, our success in the financial services industry is a result of our high-quality customer service, responsiveness, products offered, and excellent executions. Siebert 2022 Form-10K 5 Cybersecurity Cybersecurity presents significant challenges to the business community in general, as well as to the financial services industry.
We compete with a wide variety of vendors of financial services for the same customers; however, our success in the financial services industry is a result of our high-quality customer service, responsiveness, products offered, and excellent executions. Siebert 2023 Form-10K 5 Regulations Overview The securities industry in the U.S. is subject to extensive regulation under both federal and state laws.
MSCO’s systems also utilize browser-based access and other types of data communications. MSCO’s representatives use NFS systems, by way of MSCO’s data technology platform, to perform daily operational functions which include trade entry, trade reporting, clearing-related activities, risk management and account maintenance.
MSCO’s representatives use NFS systems, by way of MSCO’s data technology platform, to perform daily operational functions which include trade entry, trade reporting, clearing-related activities, risk management and account maintenance. MSCO’s data technology platform offers services used in direct relation to customer activities as well as support for corporate use.
As of March 20, 2023, we had 117 employees, one of whom was a corporate officer. None of our employees are represented by a union, and we believe that relations with our employees are good.
As of May 1, 2024, we had 124 employees, two of whom were corporate officers. None of our employees are represented by a union, and we believe that relations with our employees are good.
Siebert management is assessing the future strategic direction of RISE, taking into consideration current market conditions, demand trends, and resources. Competition We encounter significant competition from full-commission, online and discount brokerage firms, including zero commission firms, as well as from financial institutions, mutual fund sponsors, venture-backed technology and cryptocurrency firms, and other organizations.
Competition We encounter significant competition from full-commission, online and discount brokerage firms, including zero commission firms, as well as from financial institutions, mutual fund sponsors, venture-backed technology and cryptocurrency firms, and other organizations.
Reorganization of RISE, Tigress, and Hedge Connection In 2021 and 2022, Siebert and RISE engaged in certain transactions with Tigress Holdings, LLC (“Tigress”) and Hedge Connection, Inc. (“Hedge Connection”) to exchange equity, cash, and respective leadership positions.
RISE Financial Services, LLC During 2022, RISE was a prime broker focused on providing institutional quality services to hedge funds and other institutional investors. In 2022, Siebert and RISE engaged in certain transactions with Tigress Holdings, LLC (“Tigress”) and Hedge Connection, Inc. (“Hedge Connection”) to exchange equity, cash, and respective leadership positions.
In addition, we are subject to U.S. sanctions programs administered by the Office of Foreign Assets Control.
As FINRA member firms, MSCO and RISE are subject to FINRA rules requiring written anti-money laundering programs. In addition, we are subject to U.S. sanctions programs administered by the Office of Foreign Assets Control.
Our phone number is (212) 644-2400 and our Internet address is www.siebert.com. We have 12 branch offices throughout the U.S. and clients around the world. As of March 20, 2023, we had 117 full-time employees.
Our phone number is (310) 385-1861 and our Internet address is www.siebert.com . Information included or available through our website does not constitute a part of this Report. We have 11 branch offices throughout the U.S. and clients around the world. As of May 1, 2024, we had 124 full-time employees.
MSCO is a self-clearing broker-dealer and also clears with National Financial Services Corp. (“NFS”), a wholly-owned subsidiary of FMR, LLC. Securities Finance and Market Making We make markets in multiple exchanges and in over 2,000 equity securities and fixed income products. The client service offerings within our Market Making division have evolved with capital markets and different trading strategies.
We have seen positive results in recent years and are committed to continue to expand our securities finance operations. We make markets in multiple exchanges and in over 500 equity securities and fixed income products. The client service offerings within our Market Making division have evolved with the capital markets and different trading strategies.
Refer to Item 1A. – Risk Factors for more detail. Regulations Overview The securities industry in the U.S. is subject to extensive regulation under both federal and state laws. The SEC is the federal agency charged with administration of the federal securities laws. MSCO and RISE are registered as broker-dealers with the SEC.
The SEC is the federal agency charged with administration of the federal securities laws. MSCO and RISE are registered as broker-dealers with the SEC. MSCO is a member of the NYSE and FINRA, and RISE is a member of FINRA.
Products and Services • Fixed annuities • Personal insurance • Property and casualty insurance • Natural disaster insurance • Life and disability Siebert 2022 Form-10K 4 Siebert Technologies, LLC Overview STCH is a technology company initially tasked with developing a robo-advisor platform.
Products and Services The products and services offered by PW include: ● Fixed annuities ● Personal insurance ● Property and casualty insurance ● Natural disaster insurance ● Life and disability Siebert Technologies, LLC STCH is a technology company through which we are expanding our products and services and we plan to use this subsidiary for future fintech opportunities.
Today, MSCO offers a wide range of products and services and is the primary subsidiary of Siebert.
On January 1, 2024, MSCO changed its name to Muriel Siebert & Co., LLC and its tax status from a C-Corporation to a Limited Liability Corporation. Refer to Note 24 – Subsequent Events for further detail. Today, MSCO offers a wide range of products and services and is the primary subsidiary of Siebert.
Removed
Through STCH, we expanded our products and services by offering a robo-advisor through SXNT, and we plan to use this subsidiary for future fintech opportunities and products and services. RISE Financial Services, LLC During 2021 and 2022, RISE Prime Services, LLC was a prime broker focused on providing institutional quality services to hedge funds and other institutional investors.
Added
We conduct the following lines of business through our wholly-owned and majority-owned subsidiaries: ● Muriel Siebert & Co., LLC (“MSCO”) provides retail brokerage services.
Removed
Increasingly, bad actors, both domestically and internationally, attempt to steal personal data and/or interrupt the normal functioning of businesses through accessing individuals’ and companies’ files and equipment connected to the internet.
Added
Below are some key points of our strategic outlook and initiatives within Siebert Corporate Services. ● Strategic Shift and Business Evolution: Throughout 2023, Siebert Corporate Services has initiated a strategy shift, transitioning from transaction-based service delivery to focus on the overall client experience. ● Investment in Innovation and Technology: We have made a commitment to innovation and investment in technology that we believe will provide efficiencies and accelerate our service-to-sales model.
Removed
Recently, intruders have become increasingly sophisticated and use deceptive methods to steal funds and personally identifiable information which they either take for their own purposes, release to the internet, or hold for ransom. Regulators are increasingly requiring companies to provide more advanced levels of cybersecurity measures.
Added
This strategic approach is critical in driving future growth in account conversion revenue. ● Future Outlook: Industry consolidation and rising minimum plan value requirements among competitors is creating an underserved market of public issuers looking for new service providers. Siebert Corporate Services is currently developing an enhanced equity management solution to capture new market opportunities.
Removed
We continue to maintain systems and ongoing planning measures to prevent any such attack from disrupting our services to clients as well as to prevent any loss of data concerning our clients, their financial affairs, and company-privileged information. We contract cybersecurity consultants as well as other vendors to oversee detection and defense from such attacks.
Added
The robo-advisor continuously monitors and periodically rebalances portfolios to address changes in market and economic conditions. On January 1, 2024, SNXT changed its name to Siebert AdvisorNXT, LLC and its tax status from a C-Corporation to a Limited Liability Corporation. Refer to Note 24 – Subsequent Events for further detail.
Added
Margin Lending Margin lending activities are subject to limitations imposed by regulations of the Board of Governors of the Federal Reserve System and FINRA, as well as other SROs.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

38 edited+18 added−10 removed77 unchanged
Biggest changeIn the event that we experience a material cybersecurity incident or identify a material cybersecurity threat, we will make all reasonable efforts to properly disclose it in a timely fashion. It is impossible, however, for us to know when or if such incidents may arise or the business impact of any such incident.
Biggest changeIt is impossible, however, for us to know when or if such incidents may arise or the business impact of any such incident. As a result of such risks, we have and are likely to incur significant costs in preparing our infrastructure and maintaining it to resist any such attacks.
The rules and interpretations adopted by the SEC in June 2019 include Regulation Best Interest and the new Form CRS Relationship Summary, which are intended to enhance the quality and transparency of retail investors' relationships with broker-dealers and investment advisers.
The rules and interpretations adopted by the SEC in June 2019 include Regulation Best Interest and the Form CRS Relationship Summary, which are intended to enhance the quality and transparency of retail investors’ relationships with broker-dealers and investment advisers.
We are also subject to regulation by SROs and other regulatory bodies in the U.S., such as the SEC, the NYSE, FINRA, MSRB, the Commodity Futures Trading Commission (“CFTC”) and the NFA. MSCO is registered as a broker-dealer in 50 states, the District of Columbia, and Puerto Rico, and RISE is registered as a broker-dealer in 22 states and territories.
We are also subject to regulation by SROs and other regulatory bodies in the U.S., such as the SEC, the NYSE, FINRA, MSRB, the Commodity Futures Trading Commission (“CFTC”) and the NFA. MSCO is registered as a broker-dealer in 50 states, the District of Columbia, and Puerto Rico, and RISE is registered as a broker-dealer in 7 states and territories.
Any changes in the laws, rules, regulations, governmental policies or accounting principles relating to our business could materially and adversely affect our business, results of operations and financial condition. Additionally, like other participants in the financial services industry, we and our subsidiaries face the risks of lawsuits by clients and risks of regulatory proceeding against us.
Any changes in the laws, rules, regulations, governmental policies or accounting principles relating to our business could materially and adversely affect our business, results of operations and financial condition. Additionally, like other participants in the financial services industry, we and our subsidiaries face the risks of lawsuits by clients and regulatory proceedings against us.
The Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"), enacted in 2010, required many federal agencies to adopt new rules and regulations applicable to the financial services industry and called for many studies regarding various industry practices.
The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), enacted in 2010, required many federal agencies to adopt new rules and regulations applicable to the financial services industry and called for many studies regarding various industry practices.
This amount represented, as of the date of this Report, an aggregate of 7% of the total issued and outstanding membership interests in RISE. As of the date of this Report, Gloria E. Gebbia owns approximately 25% of RISE.
This amount represented, as of the date of this Report, an aggregate of 7% of the total issued and outstanding membership interests in RISE. As of the date of this Report, Gloria E. Gebbia owns approximately 24% of RISE.
Although we believe we may benefit from a rising interest rate environment, a rise in interest rates may cause our funding costs to increase if market conditions or the competitive environment induces us to raise our interest rates to avoid losing deposits, or replace deposits with higher cost funding sources without offsetting increases in yields on interest-earning assets which can reduce our interest revenue.
Although we believe we may benefit from the current interest rate environment, higher interest rates may cause our funding costs to increase if market conditions or the competitive environment induces us to raise our interest rates to avoid losing deposits, or replace deposits with higher cost funding sources without offsetting increases in yields on interest-earning assets which can reduce our interest revenue.
Siebert 2022 Form-10K 10 The laws, rules and regulations, as well as governmental policies and accounting principles, governing our business and the financial services and banking industries generally have changed significantly over recent years and are expected to continue to do so. We cannot predict which changes in laws, rules, regulations, governmental policies or accounting principles will be adopted.
Siebert 2023 Form-10K 9 The laws, rules and regulations, as well as governmental policies and accounting principles, governing our business and the financial services and banking industries generally have changed significantly over recent years and are expected to continue to do so. We cannot predict which changes in laws, rules, regulations, governmental policies or accounting principles will be adopted.
Acquisitions and other transactions entail numerous risks, including: • Difficulties in the integration of acquired operations, services and products; • Failure to achieve expected synergies; • Diversion of management’s attention from other business concerns; • Assumption of unknown material liabilities of acquired companies; • Amortization of acquired intangible assets, which could reduce future reported earnings; • Potential loss of clients or key employees of acquired companies; and • Dilution to existing stockholders.
Acquisitions and other transactions entail numerous risks, including: ● Difficulties in the integration of acquired operations, services and products; Siebert 2023 Form-10K 12 ● Failure to achieve expected synergies; ● Diversion of management’s attention from other business concerns; ● Assumption of unknown material liabilities of acquired companies; ● Amortization of acquired intangible assets, which could reduce future reported earnings; ● Potential loss of clients or key employees of acquired companies; and ● Dilution to existing stockholders.
Siebert 2022 Form-10K 13 Our future success will depend on our ability to: • Enhance our existing products and services; • Develop and/or license new products and technologies that address the increasingly sophisticated and varied needs of our clients and prospective clients; • Continue to attract highly-skilled technology personnel; and • Respond to technological advances and emerging industry standards and practices on a cost-effective and timely basis.
Our future success will depend on our ability to: ● Enhance our existing products and services; ● Develop and/or license new products and technologies that address the increasingly sophisticated and varied needs of our clients and prospective clients; ● Continue to attract highly-skilled technology personnel; and ● Respond to technological advances and emerging industry standards and practices on a cost-effective and timely basis.
In addition, vulnerabilities of our external service providers and other third parties could pose security risks to client information. The secure transmission of confidential information over public networks is also a critical element of our operations. In providing services to clients, we manage, utilize and store sensitive and confidential client data, including personal data.
In addition, vulnerabilities of our external service providers and other third parties could pose security risks to client information. The secure transmission of confidential information over public networks is also a critical element of our operations. Siebert 2023 Form-10K 10 In providing services to clients, we manage, utilize and store sensitive and confidential client data, including personal data.
Risks Related to Our Business Operations Potential strategic acquisitions and other business growth could increase costs and regulatory and integration risks. Acquisitions involve risks that could adversely affect our business. We may pursue acquisitions of businesses and technologies.
Potential strategic acquisitions and other business growth could increase costs and regulatory and integration risks. Acquisitions involve risks that could adversely affect our business. We may pursue acquisitions of businesses and technologies.
More generally, because our business is closely correlated to the macroeconomic outlook, a significant deterioration in that outlook or an exogenous shock would likely have an immediate negative impact on our overall results of operations. There is intense competition in the brokerage industry.
More generally, because our business is closely correlated to the macroeconomic outlook, a significant deterioration in that outlook or an exogenous shock would likely have an immediate negative impact on our overall results of operations. Siebert 2023 Form-10K 15 There is intense competition in the brokerage industry.
As a result of the foregoing, investors in our common stock may be subject to the risk of significant, short-term price volatility of our common stock and the trading price of our common stock could decline for reasons unrelated to our business, financial condition, or results of operations.
Siebert 2023 Form-10K 14 As a result of the foregoing, investors in our common stock may be subject to the risk of significant, short-term price volatility of our common stock and the trading price of our common stock could decline for reasons unrelated to our business, financial condition, or results of operations.
We may not be able to compete effectively with current or future competitors with stronger capital position, greater name recognition or who partner or combine with other larger firms. Siebert 2022 Form-10K 18 Some competitors in the discount brokerage business offer services which we may not offer.
We may not be able to compete effectively with current or future competitors with stronger capital position, greater name recognition or who partner or combine with other larger firms. Some competitors in the discount brokerage business offer services which we may not offer.
In addition, our liability insurance might not be sufficient in type or amount to cover us against claims related to security breaches, cyber-attacks and other related breaches. Siebert 2022 Form-10K 12 We may be exposed to damage to our business or our reputation by cybersecurity breaches.
In addition, our liability insurance might not be sufficient in type or amount to cover us against claims related to security breaches, cyber-attacks and other related breaches. We may be exposed to damage to our business or our reputation by cybersecurity breaches.
Sales of a substantial number of shares of our common stock in the public market, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our common stock and make it more difficult for investors to sell common stock at a time and price that investors deem appropriate.
Sales of a substantial number of shares of our common stock in the public market by new issuances or through sales by existing shareholders, or the perception in the market that we or the holders of a large number of shares intend to sell shares, could reduce the market price of our common stock and make it more difficult for investors to sell common stock at a time and price that investors deem appropriate.
A stock with a small number of shares held by non-affiliates, known as the “float,” will generally be more volatile than a stock with a large float. Although our common stock is traded on the Nasdaq Capital Market, there can be no assurance that an active public market will continue.
A stock with a small number of shares held by non-affiliates, known as the “float,” will generally be more volatile than a stock with a large float. Although our common stock is traded on the Nasdaq Capital Market, there can be no assurance that an active public market will continue. Our principal shareholder has significant influence over us. Gloria E.
Such negative market conditions, if prolonged, may lower our revenues. A reduction in our revenues could have a material adverse effect on our business, results of operations and financial condition. ITEM 1B. UNRESOLVED STAFF COMMENTS None.
Such negative market conditions, if prolonged, may lower our revenues. A reduction in our revenues could have a material adverse effect on our business, results of operations and financial condition.
Further, adverse proceedings could have an adverse effect on our ability to retain key registered representatives, investment advisers and wealth managers, and to retain existing clients or attract new clients, any of which could have a material adverse effect on our business, financial condition, results of operations and prospects. Refer to Item 3 – Legal Proceedings for additional detail.
Further, any such proceedings or lawsuits could have an adverse effect on our ability to retain key registered representatives, investment advisers and wealth managers, and to retain existing clients or attract new clients, any of which could have a material adverse effect on our business, financial condition, results of operations and prospects.
In addition, global macroeconomic conditions and U.S. financial markets remain vulnerable to the potential risks posed by exogenous shocks, which could include, among other things, political and financial uncertainty in the U.S. and the European Union, renewed concern about China’s economy, conflict with Russia and Ukraine, complications involving terrorism and armed conflicts around the world, or other challenges to global trade or travel, such as might occur in the event of a wider pandemic involving COVID-19.
In addition, global macroeconomic conditions and U.S. financial markets remain vulnerable to the potential risks posed by exogenous shocks, which could include, among other things, political and financial uncertainty in the U.S. and the European Union, renewed concern about China’s economy, conflict with Russia and Ukraine, the conflict in Israel and the Gaza Strip, complications involving terrorism and armed conflicts around the world, or other challenges to global trade or travel.
Our businesses are, and will continue to be, susceptible to economic slowdowns, recessions and volatility in the markets, which may lead to financial losses for our customers, and a decrease in revenues and operating results.
A prolonged economic slowdown, volatility in the markets, a recession, and uncertainty in the markets could impair our business and harm our operating results. Our businesses are, and will continue to be, susceptible to economic slowdowns, recessions and volatility in the markets, which may lead to financial losses for our customers, and a decrease in revenues and operating results.
Certain employees, directors and affiliates of RISE and Siebert own equity in RISE Financial Services, LLC From January 31, 2022 to the date of this Report, RISE issued and Siebert sold membership interests in RISE to certain employees, directors, and affiliates of RISE and Siebert ranging from 1% to 2% individually.
Certain employees, directors and affiliates of RISE and Siebert own equity in RISE Financial Services, LLC During the first quarter of 2022, RISE issued and Siebert sold membership interests in RISE to certain employees, directors, and affiliates of RISE and Siebert ranging from 1% to 2% individually.
This method of trading is heavily dependent on the integrity of the electronic systems supporting it. While we have never experienced a significant failure of our trading systems, heavy stress placed on our systems during peak trading times could cause our systems to operate at unacceptably low speeds or fail altogether.
While we have never experienced a significant failure of our trading systems, heavy stress placed on our systems during peak trading times could cause our systems to operate at unacceptably low speeds or fail altogether.
We are dependent upon our key personnel for our success and the loss of the services of any of these individuals could significantly harm our business, financial condition and operating results. Our customers may fail to pay us.
We depend on our ability to attract and retain key personnel. We are dependent upon our key personnel for our success and the loss of the services of any of these individuals could significantly harm our business, financial condition and operating results.
Siebert 2022 Form-10K 11 Our data technology platforms offer services used in direct relation to customer activities as well as support for corporate use. Some of these services include email and messaging, market data systems and third-party trading systems, business productivity tools and customer relationship management systems.
Our data technology platforms offer services used in direct relation to customer activities as well as support for corporate use. Some of these services include email and messaging, market data systems and third-party trading systems, business productivity tools and customer relationship management systems. Our data network is designed with redundancies in case a significant business disruption occurs.
The average daily trading volume from January 1, 2022 to December 31, 2022 was approximately 25,010 shares.
The average daily trading volume from January 1, 2023 to December 31, 2023 was approximately 77,052 shares.
Risks Related to Our Common Stock There may be a limited public market for our common stock; Volatility. 13,198,585 shares of our common stock, or approximately 41% of our shares of our common stock outstanding, are currently held by non-affiliates as of March 20, 2023.
Siebert 2023 Form-10K 13 Risks Related to Our Common Stock There may be a limited public market for our common stock; Volatility. 13,255,556 shares of our common stock, or approximately 33.3% of our shares of our common stock outstanding, are currently held by non-affiliates as of May 1, 2024.
Our compliance with the net capital requirements could limit operations that require intensive use of capital, such as underwriting or trading activities. These rules could also restrict our ability to withdraw our capital, even in circumstances where we have more than the minimum amount of required capital, which, in turn, could limit our ability to implement growth strategies.
These rules could also restrict our ability to withdraw our capital, even in circumstances where we have more than the minimum amount of required capital, which, in turn, could limit our ability to implement growth strategies.
Siebert 2022 Form-10K 16 Our future ability to pay dividends to holders of our common stock is subject to the discretion of our Board of Directors and will be limited by our ability to generate sufficient earnings and cash flows. Payment of future cash dividends on our common stock will depend on our ability to generate earnings and cash flows.
Our future ability to pay dividends to holders of our common stock is subject to the discretion of our Board of Directors and will be limited by our ability to generate sufficient earnings and cash flows. We did not pay any dividends in 2023 or 2022.
If new industry standards and practices emerge and our competitors release new technology before us, our existing technology, systems and electronic trading services may become obsolete or our existing business may be harmed.
The electronic financial services industry is characterized by significant structural changes, increasingly complex systems and infrastructures, changes in clients’ needs and preferences, and new business models. If new industry standards and practices emerge and our competitors release new technology before us, our existing technology, systems and electronic trading services may become obsolete or our existing business may be harmed.
Siebert 2022 Form-10K 15 Future sales of our common stock in the public market could cause the market price of our common stock to drop significantly, even if our business is doing well.
As a result, they have significant influence on matters submitted to a vote of shareholders. Future sales of our common stock in the public market could cause the market price of our common stock to drop significantly, even if our business is doing well.
We are subject to net capital requirements. The SEC, FINRA, and various other securities and commodities exchanges and other regulatory bodies in the U.S. have rules with respect to net capital requirements which affect us. These rules have the effect of requiring that at least a substantial portion of a broker-dealer’s assets be kept in cash or highly liquid investments.
Refer to Item 3 – Legal Proceedings for additional detail. We are subject to net capital requirements. The SEC, FINRA, and various other securities and commodities exchanges and other regulatory bodies in the U.S. have rules with respect to net capital requirements which affect us.
Rapid market or technological changes may render our technology obsolete or decrease the attractiveness of our products and services to our clients. We must continue to enhance and improve our technology and electronic services. The electronic financial services industry is characterized by significant structural changes, increasingly complex systems and infrastructures, changes in clients’ needs and preferences, and new business models.
Siebert 2023 Form-10K 11 Rapid market or technological changes may render our technology obsolete or decrease the attractiveness of our products and services to our clients. We must continue to enhance and improve our technology and electronic services, and expect to increase investments in our own technology.
As a result of such risks, we have and are likely to incur significant costs in preparing our infrastructure and maintaining it to resist any such attacks. An increase in volume on our systems or other events could cause them to malfunction. Most of our trade orders are received and processed electronically.
An increase in volume on our systems or other events could cause them to malfunction. Most of our trade orders are received and processed electronically. This method of trading is heavily dependent on the integrity of the electronic systems supporting it.
As the U.S. economy recovers, aided by stimulus packages and fiscal and monetary policies, inflation has been rising at historically high rates, and the Federal Reserve has signaled that it will continue increasing the target federal funds effective rate.
As the U.S. economy remains in a strong recovery, aided by fiscal and monetary policies, inflation has been rising at historically high rates, and the Federal Reserve may raise, maintain or lower rates in the future.
Gebbia, who is a director of Siebert and the managing member of Kennedy Cabot Acquisition, LLC (“KCA”), has, along with other family members, the power to elect the entire Board of Directors and, except as otherwise provided by law or our Certificate of Incorporation or by-laws, to approve any action requiring shareholder approval without a shareholders meeting.
Gebbia, who is a director of Siebert, the managing member of Kennedy Cabot Acquisition, LLC (“KCA”) and the spouse of Siebert’s Chief Executive Officer, has, along with other family members, the power to nominate six directors to the Board of Directors and owns approximately 43% of our common stock.
However, sufficient cash may not be available to pay such dividends.
Payment of future cash dividends on our common stock will depend on our ability to generate earnings and cash flows. However, sufficient cash may not be available to pay such dividends.
Removed
Our data network is designed with redundancies in case a significant business disruption occurs.
Added
These rules have the effect of requiring that at least a substantial portion of a broker-dealer’s assets be kept in cash or highly liquid investments. Our compliance with the net capital requirements could limit operations that require intensive use of capital, such as underwriting or trading activities.
Removed
In addition, management is assessing the future strategic direction of RISE, taking into consideration current market conditions, demand trends, and resources.
Added
Risks Related to Our Business Operations Our management identified a material weakness in our internal control over financial reporting which could, if not remediated, result in material misstatements in our consolidated financial statements. Our management is responsible for establishing and maintaining adequate internal controls over our financial reporting, as such term is defined in Rule 13a-15(f) under the Exchange Act.
Removed
While we believe our expertise and industry relationships will enable us to execute a new strategic direction, our business plan for RISE is untested, and it is uncertain whether our efforts will attract the customers and revenue necessary to compete in the market.
Added
As disclosed in this report, we evaluated the effectiveness of our internal control over financial reporting and identified a material weakness as of December 31, 2023.
Removed
We may be unable to realize the anticipated benefits of our cost cutting efforts or it may take longer than anticipated for us to realize any benefits from increased cost efficiencies or economies of scale, if at all.
Added
The material weakness is that we did not design and maintain effective controls over certain information technology (“IT”) or general computer controls for information systems that are relevant to the preparation of the consolidated financial statements.
Removed
Our realization of the benefits anticipated as a result of cost cutting efforts and other business efforts and changes will depend in part on the ability of our management team to implement our business plan. We cannot assure shareholders that there will not be substantial costs associated with these activities or other negative consequences as a result of these changes.
Added
Specifically, we did not design and maintain user access controls to ensure appropriate segregation of duties and adequate restricted user and privileged access to financial applications, data and programs to the appropriate personnel. The IT deficiencies did not result in adjustments to the consolidated financial statements.
Removed
These effects include, but are not limited to, incurring unexpected costs or delays in connection with implementation of a modified business model, or the failure of our business to perform as expected, which could harm our results of operations. Siebert 2022 Form-10K 14 We depend on our ability to attract and retain key personnel.
Added
A material weakness is defined as a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
Removed
Our principal shareholder has the ability to control key decisions submitted to a vote of our shareholders. Gloria E.
Added
If not remediated, the material weakness identified above could result in material misstatements in our consolidated financial statements.
Removed
In addition, on February 18, 2022, we filed a shelf registration statement on Form S-3 that was declared effective on March 2, 2022 by the SEC for the potential offering, issuance and sale by us of up to $100.0 million, subject to certain limitations, of our common stock, preferred stock, warrants to purchase our common Stock and/or preferred stock, units consisting of all or some of these securities and subscription rights to purchase all or some of these securities.
Added
In addition, if we are unable to maintain effective internal control over financial reporting or disclosure controls and procedures, our ability to record, process and report financial information accurately, and to prepare financial statements within required time periods could be adversely affected, which could subject us to litigation or investigations requiring management resources and payment of legal and other expenses, negatively affect investor confidence in our financial statements and adversely impact our stock price.
Removed
If we sell our common stock, preferred stock, convertible securities and other equity securities in other transactions pursuant to our shelf registration statement on Form S-3, existing investors may be materially diluted by such subsequent sales, new investors could gain rights superior to our existing shareholders and the market price of our common stock may drop significantly.
Added
We do not own the Muriel Siebert and Siebert names, but we may use them as part of our corporate name pursuant to a license agreement. Use of the names by other parties or the expiration or termination of our license agreement may harm our business.
Removed
Siebert 2022 Form-10K 17 A prolonged economic slowdown, volatility in the markets, a recession, and uncertainty in the markets could impair our business and harm our operating results.
Added
We have entered into a license agreement with the Muriel Siebert Estate / Foundation under which we have a license to use the “Muriel Siebert” and “Siebert” name until 2025.
Added
In the event that the license agreement is terminated, or if the license agreement is not renewed or extended beyond 2025, we may be required to change our name and cease using the name. Any of these events could disrupt our recognition in the marketplace and otherwise harm our business. Our customers may fail to pay us.
Added
On April 27, 2023, Siebert entered into a Stock Purchase Agreement (the “First Tranche Stock Purchase Agreement”) with Kakaopay Corporation (“Kakaopay”), a company established under the Laws of the Republic of Korea, pursuant to which Siebert issued to Kakaopay 8,075,607 shares of Siebert’s common stock, which represented at the time of issuance 19.9% of the outstanding equity securities of Siebert on a fully diluted basis.
Added
The First Tranche closed on May 18, 2023 and, in connection therewith, we entered into a Registration Rights and Lock-Up Agreement, dated as of May 19, 2023 (the “Registration Rights Agreement”), with Kakaopay.
Added
In accordance with the Registration Rights Agreement and the Settlement Agreement (as defined below), in January 2024 we filed a Form S-3 registration statement with the SEC registering these shares for resale.
Added
However, since we filed this Report after its scheduled due date, we no longer satisfy the eligibility requirements for use of registration statements on Form S-3, which requires that we file in a timely manner all reports required to be filed during the prior twelve calendar months.
Added
As a result, we have suspended use of the registration statement on Form S-3. Kakaopay may still sell shares pursuant to Rule 144 under the Securities Act of 1933, as amended, prior to the filing of any future registration statement.
Added
The number of shares of common stock could be significant in relation to our currently outstanding common stock and the historical trading volume of our common stock. The sale by Kakaopay of all or a significant portion of the shares of common stock could have a material adverse effect on the market price of our common stock.
Added
In addition, the perception in the public markets that Kakaopay might sell all or a portion of the shares of common stock could also, in and of itself, have a material adverse effect on the market price of our common stock.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe operate our business out of the following branch offices: Approximate Square Feet Corporate Headquarters New York, NY - 535 Fifth Avenue 300 Branch Offices Beverly Hills, CA – 190 N Canon 900 Beverly Hills, CA – 9378 Wilshire 3,500 Boca Raton, FL 1,600 Boston, MA 1,700 Calabasas, CA 3,200 Horsham, PA 2,000 Jersey City, NJ 11,000 Miami, FL 11,600 Omaha, NE 2,900 Seal Beach, CA 800 Tampa, FL 1,000 Troy, MI 300
Biggest changeWe operate our business out of the following branch offices: Approximate Square Feet Corporate Headquarters Miami Beach, FL – 653 Collins Avenue 12,000 Branch Offices Beverly Hills, CA – 190 N Canon 900 Beverly Hills, CA – 9378 Wilshire 3,500 Boca Raton, FL 1,600 Boston, MA 1,700 Calabasas, CA 3,200 Horsham, PA 2,000 Jersey City, NJ 11,000 Omaha, NE 2,900 Seal Beach, CA 800 Tampa, FL 1,000 New York, NY 8,000
ITEM 2. PROPERTIES We currently maintain 12 branch offices and customers can visit our branch offices to obtain market information, place orders, open accounts, deliver and receive checks and securities, and obtain related customer services in person. Nevertheless, most of our activities are conducted on the internet or by telephone and mail.
ITEM 2. PROPERTIES We currently maintain 11 branch offices and customers can visit our branch offices to obtain market information, place orders, open accounts, deliver and receive checks and securities, and obtain related customer services in person. Nevertheless, most of our activities are conducted on the internet or by telephone and mail.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS We are party to certain claims, suits and complaints arising in the ordinary course of business. For activity related to operations of StockCross Financial Services, Inc. (“StockCross”) prior to our acquisition of StockCross, FINRA’s Division of Enforcement is currently investigating UIT transactions that were executed by StockCross that the enforcement staff believes were terminated early.
Biggest changeITEM 3. LEGAL PROCEEDINGS We are party to certain claims, suits and complaints arising in the ordinary course of business. As of the date of this Report, we do not expect that these claims, suits and complaints will have a material impact on our results of operations or financial position.
Removed
We believe that many of these transactions were UIT transactions that were the subject of our prior settlements with the Commonwealth of Massachusetts (Dkt. No. E-2017-0104) and the State of California (CRD No.s: 6670 and 2400211). All of these transactions occurred prior to our acquisition of StockCross on January 1, 2020.
Removed
Siebert 2022 Form-10K 19 Management cannot at this time assess either the duration or the likely outcome or consequences of the FINRA investigation. Nevertheless, FINRA has the authority to impose sanctions on Siebert or require that it make offers of restitution to other customers who FINRA believes incurred sales charges in early liquidations of UITs.
Removed
No assurances can be given that a mutual settlement with FINRA regarding the investigation can be reached or that any amount paid in settlement will not be material. In the opinion of management, all other legal matters are without merit, or involve amounts which would not have a material impact on our results of operations or financial position. ITEM 4.
Removed
MINE SAFETY DISCLOSURES Not applicable. Siebert 2022 Form-10K 20 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAs of March 20, 2023, there were 75 holders of record of our common stock based on information provided by our transfer agent. The number of stockholders of record does not reflect the number of individual or institutional stockholders that beneficially own our stock because most stock is held in the name of nominees.
Biggest changeThe number of stockholders of record does not reflect the number of individual or institutional stockholders that beneficially own our stock because most stock is held in the name of nominees. Based on information available to us, we believe there are approximately 3,782 beneficial holders of our common stock as of February 9, 2024.
In considering whether to pay such dividends, our Board of Directors will review our earnings, capital requirements, economic forecasts and such other factors as are deemed relevant. Some portion of our earnings will be retained to provide capital for the operation and expansion of our business.
In considering whether to pay such dividends, our Board of Directors will review our earnings, capital requirements, economic forecasts and such other factors as are deemed relevant. For information on securities authorized for issuance under our equity compensation plans, see “Item 12.
Refer to Note 12 – Investments, Cost for more detail.
Refer to Note 5 – Kakaopay Transaction for more detail.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock traded on the Nasdaq Global Market until June 29, 2011 when our common stock started trading on the Nasdaq Capital Market, under the symbol “SIEB.” The closing sale price of our common stock as reported on the Nasdaq Capital Market on March 20, 2023 was $1.54 per share.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock trades on the Nasdaq Capital Market, under the symbol “SIEB.” Holders As of April 2, 2024, there were 73 holders of record of our common stock based on information provided by our transfer agent.
On November 16, 2021, we issued 1,449,525 shares of our common stock to Tigress in consideration of an equity interest in Tigress pursuant to a certain contribution agreement, by and among Siebert, RISE, and Tigress. The common stock was issued pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.” Unregistered Sales of Equity Securities and Use of Proceeds On May 18, 2023, we issued 8,075,607 shares of our common stock to Kakaopay as part of a transaction with Kakaopay. The common stock was issued pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended.
Removed
Based on information available to us, we believe there are approximately 4,304 beneficial holders of our common stock as of March 20, 2023. Dividend Policy Our Board of Directors periodically considers whether to declare dividends.
Added
Dividend Policy No dividends were paid to shareholders during 2023 and 2022. Our Board of Directors periodically considers whether to declare dividends, and any future decision to pay dividends is at the discretion of the Board of Directors.
Removed
Share Price Volatility Since our common stock started trading on the Nasdaq Capital Market, our common stock has been relatively thinly traded and at times been subject to price volatility. From January 1, 2022 to December 31, 2022, the average close price of our common stock was $1.79 per share.
Removed
The average daily trading volume from January 1, 2022 to December 31, 2022 was approximately 25,010 shares.
Removed
Equity Compensation Plan Information Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted- average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (a) (b) (c) Equity compensation plans approved by security holders — NA 2,704,000 Equity compensation plans not approved by security holders — NA NA Total — NA 2,704,000 Unregistered Sales of Equity Securities and Use of Proceeds For the year ended December 31, 2022, we granted 186,000 unregistered restricted stock units as compensation to certain employees and consultants under Siebert’s 2021 Equity Incentive Plan.
Removed
The units were fully vested upon grant date and were issued pursuant to Rule 701 and/or Section 4(a)(2) of the Securities Act of 1933, as amended.
Removed
Refer to Note 11 – Equity Method Investment in Related Parties for more detail. On August 18, 2021, we amended our common stock purchase agreement with OpenHand Holdings, Inc. (“OpenHand”), dated January 31, 2021, and, pursuant to the amendment, cancelled 329,654 shares of our common stock that we issued to OpenHand pursuant to the original stock purchase agreement.
Removed
Siebert 2022 Form-10K 21 On January 31, 2021, Siebert and OpenHand entered into a stock purchase agreement whereby Siebert acquired an interest of 5% of OpenHand common stock for consideration of a total of $2,231,000 consisting of $850,000 in cash and 329,654 restricted shares of Siebert’s common stock valued at $1,381,000 or $4.19 per share.
Removed
The common stock was issued pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended. Refer to Note 12 – Investments, Cost for more detail. On November 10, 2020, Siebert issued 150,000 shares of its restricted common stock to each of Anthony Palmeri and Gerard Losurdo, each an employee of MSCO, as part of their employment agreements. Mr.
Removed
Palmeri and Mr. Losurdo each paid Siebert approximately $400,000 for their shares, which was equal to 70% of the closing price of Siebert’s common stock as reported on Nasdaq on November 9, 2020. The common stock issued to Mr. Palmeri and Mr. Losurdo was subject to a three-year restriction on transfer commencing on the day of issuance.
Removed
The issuance of common stock was approved by unanimous written consent of Siebert’s board of directors. The common stock was issued to Mr. Palmeri and Mr. Losurdo as part of their employment agreements in accordance with Nasdaq Listing Rule 5635(c)(4) and pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended.
Removed
On April 21, 2020, we entered into an agreement with a technology partner pursuant to which the technology partner acquired 193,906 shares of our restricted common stock.
Removed
The common stock was issued on May 12, 2020 at a per share price of $5.81 (Siebert’s share price as of the close of May 12, 2020) for a total of $1.1 million for professional services to integrate the technology partner’s software into Siebert’s existing platforms as well as its robo-advisor.
Removed
The common stock was issued pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended. Effective January 1, 2020, we acquired the remaining 85% of StockCross’ outstanding shares in exchange for 3,298,774 shares of our common stock, and StockCross was merged with and into MSCO.
Removed
The common stock was issued pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended. Siebert 2022 Form-10K 22

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

61 edited+47 added−29 removed28 unchanged
Biggest changeClient Account Metrics – Retail and Institutional Customer Net Worth As of December 31, 2022 2021 Retail and institutional customer net worth (in billions) $ 13.5 $ 17.3 Client Account Metrics – Retail Customers As of December 31, 2022 2021 Retail customer net worth (in billions) $ 13.5 $ 16.8 Retail customer margin debit balances (in billions) $ 0.4 $ 0.5 Retail customer credit balances (in billions) $ 0.6 $ 0.8 Retail customer money market fund value (in billions) $ 0.6 $ 0.8 Retail customer accounts 122,394 115,380 • Retail customer net worth represents the total value of securities and cash in the retail customer accounts after deducting margin debits • Retail customer margin debit balances represents credit extended to our customers to finance their purchases against current positions • Retail customer credit balances represents client cash held in brokerage accounts • Retail customer money market fund value represents all retail customers accounts invested in money market funds • Retail customer accounts represents the number of retail customers Client Account Metrics – Institutional Customers As of December 31, 2022 2021 Institutional customer net worth (in billions) $ — $ 0.5 • Institutional customer net worth represents the total value of securities and cash in the institutional customer accounts after deducting margin debits and short positions.
Biggest changeClient Account Metrics – Retail Customers As of December 31, 2023 2022 Retail customer net worth (in billions) $ 15.9 $ 13.5 Retail customer margin debit balances (in billions) $ 0.3 $ 0.4 Retail customer credit balances (in billions) $ 0.5 $ 0.6 Retail customer money market fund value (in billions) $ 0.7 $ 0.6 Retail customer accounts 153,727 122,394 ● Retail customer net worth represents the total value of securities and cash in the retail customer accounts after deducting margin debits ● Retail customer margin debit balances represents credit extended to our customers to finance their purchases against current positions ● Retail customer credit balances represents client cash held in brokerage accounts ● Retail customer money market fund value represents all retail customers accounts invested in money market funds ● Retail customer accounts represents the number of retail customers Account Growth Initiatives During 2023, our management team engaged in several account growth initiatives that led to significant growth in our retail customer accounts from 2022.
If our estimates of fair value change due to future events differing significantly from the forecasts used to determine fair value or there are changes in our business or other factors, we will assess the amount of impairment and recognize it in our financial statements during that reporting period.
If our estimates of fair value change due to future events differing significantly from the forecasts used to determine fair value or there are changes in our business or other factors, we will assess the amount of impairment and recognize it in our consolidated financial statements during that reporting period.
Estimates of effective income tax rates, uncertain tax positions, deferred income taxes and related valuation allowances We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements.
Estimates of effective income tax rates, uncertain tax positions, deferred income taxes and related valuation allowances We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements.
The total changes in our statements of cash flows, especially our operating cash flow, are not necessarily indicative of the ongoing results of our business as we have customer assets and liabilities on our statements of financial condition.
The total changes in our consolidated statements of cash flows, especially our operating cash flow, are not necessarily indicative of the ongoing results of our business as we have customer assets and liabilities on our consolidated statements of financial condition.
These activities may expose us to off-balance sheet risk in the event the customer or other broker is unable to fulfill their contracted obligations and we are forced to purchase or sell the financial instrument underlying the contract at a loss. There were no material losses for unsettled customer transactions for the years ended December 31, 2022 and 2021.
These activities may expose us to off-balance sheet risk in the event the customer or other broker is unable to fulfill their contracted obligations and we are forced to purchase or sell the financial instrument underlying the contract at a loss. There were no material losses for unsettled customer transactions for the years ended December 31, 2023 and 2022.
RISE can transfer funds to its shareholders, of which Siebert is entitled to its proportional ownership interest, as long as RISE maintains its liquidity and regulatory capital requirements. For the years ended December 31, 2022 and 2021, MSCO and RISE had sufficient net capital to meet their respective liquidity and regulatory capital requirements.
RISE can transfer funds to its shareholders, of which Siebert is entitled to its proportional ownership interest, as long as RISE maintains its liquidity and regulatory capital requirements. For the years ended December 31, 2023 and 2022, MSCO and RISE had sufficient net capital to meet their respective liquidity and regulatory capital requirements.
Siebert 2022 Form-10K 30 Shelf Registration Statement On February 18, 2022, we filed a shelf registration statement on Form S-3 that was declared effective on March 2, 2022 by the SEC for the potential offering, issuance and sale by us of up to $100.0 million of our common stock, preferred stock, warrants to purchase our common stock and/or preferred stock, units consisting of all or some of these securities and subscription rights to purchase all or some of these securities.
Siebert 2023 Form-10K 25 Shelf Registration Statement On February 18, 2022, we filed a shelf registration statement on Form S-3 that was declared effective on March 2, 2022 by the SEC for the potential offering, issuance and sale by us of up to $100.0 million of our common stock, preferred stock, warrants to purchase our common stock and/or preferred stock, units consisting of all or some of these securities and subscription rights to purchase all or some of these securities.
The estimates relate primarily to revenue and expense items in the normal course of business as to which we receive no confirmations, invoices, or other documentation, at the time the books are closed for a period. We use our best judgment, based on our knowledge of revenue transactions and expenses incurred, to estimate the amount of such revenue and expenses.
The estimates relate primarily to expense items in the normal course of business as to which we receive no confirmations, invoices, or other documentation, at the time the books are closed for a period. We use our best judgment, based on our knowledge of expenses incurred, to estimate the amount of such expenses.
We recognize interest and penalties related to unrecognized tax benefits on the provision for income taxes line in the statements of operations. Accrued interest and penalties would be included on the related tax liability line in the statements of financial condition.
We recognize interest and penalties related to unrecognized tax benefits on the provision for income taxes line on the consolidated statements of operations. Accrued interest and penalties would be included on the related tax liability line on the consolidated statements of financial condition.
Under this method, we determine deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse.
Under this method, we determine deferred tax assets and liabilities on the basis of the differences between the consolidated financial statements and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse.
Transactions with Tigress and Hedge Connection On November 16, 2021, we purchased 24% of the outstanding membership interests in Tigress, a disabled and woman-owned financial services firm, in exchange for 24% of RISE and shares of Siebert common stock.
Siebert 2023 Form-10K 21 Transactions with Tigress and Hedge Connection On November 16, 2021, we purchased 24% of the outstanding membership interests in Tigress, a disabled and woman-owned financial services firm, in exchange for 24% of RISE and shares of Siebert common stock.
Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Annual Report on Form 10-K, particularly in Part I, Item 1A - Risk Factors. Overview We are a financial services company and provide a wide variety of financial services to our clients.
Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Report, particularly in Part I, Item 1A - Risk Factors. Overview We are a financial services company and provide a wide variety of financial services to our clients.
The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. We recognize deferred tax assets to the extent that we believe that these assets are more likely than not to be realized.
The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. Siebert 2023 Form-10K 27 We recognize deferred tax assets to the extent that we believe that these assets are more likely than not to be realized.
Long Term Contracts Contract with NFS Effective August 1, 2021, MSCO entered into an amendment to its clearing agreement with NFS that, among other things, extends the term of their arrangement for an additional four-year period commencing on August 1, 2021 and ending July 31, 2025.
Siebert 2023 Form-10K 26 Long Term Contracts Effective August 1, 2021, MSCO entered into an amendment to its clearing agreement with NFS that, among other things, extends the term of their arrangement for an additional four-year period commencing on August 1, 2021 and ending July 31, 2025.
Siebert 2022 Form-10K 33 Goodwill and other intangible assets Goodwill is recognized as a result of business combinations and represents the excess of the purchase price over the fair value of net tangible assets and identifiable intangible assets acquired. The valuation of goodwill and acquired intangible assets requires significant judgment and estimates by management.
Goodwill and other intangible assets Goodwill is recognized as a result of business combinations and represents the excess of the purchase price over the fair value of net tangible assets and identifiable intangible assets acquired. The valuation of goodwill and acquired intangible assets requires significant judgment and estimates by management.
The amendment also provides for an early termination fee; however, as of December 31, 2022, we do not expect to terminate the contract with NFS before the end of the contract term. Refer to Note 15 – Deferred Contract Incentive and Note 22 – Commitments, Contingencies and Other for additional detail.
The amendment also provides for an early termination fee; however, as of December 31, 2023, we do not expect to terminate the contract with NFS before the end of the contract term. Refer to Note 16 – Deferred Contract Incentive and Note 21 – Commitments, Contingencies and Other for additional detail.
Loss on Sale of Equity Method Investment in Related Parties Loss on sale of equity method investment in related parties for the year ended December 31, 2022 was $719,000 and increased by $719,000 from the corresponding period in the prior year due to our loss on the transactions between Siebert, RISE, Hedge Connection and Tigress.
Loss on sale of equity method investment in related party for the year ended December 31, 2023 was $0 and decreased by $719,000 from the corresponding period in the prior year due to our loss on the transactions between Siebert, RISE, Hedge Connection and Tigress in 2022.
ITEM 7. MANAGEMENT’S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes included in Part II, Item 8 - Financial Statements and Supplementary Data of this Annual Report on Form 10-K.
ITEM 7. MANAGEMENT’S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and the related notes included in Part II, Item 8 - Financial Statements and Supplementary Data of this Report.
Debt Agreements We have a $4.4 million mortgage and a $2.7 million loan outstanding with East West Bank, and an unutilized line of credit for short term overnight demand borrowing of up to $25 million with BMO Harris as of December 31, 2022.
Debt Agreements We have a $4.3 million mortgage with East West Bank and an unutilized line of credit for short term overnight demand borrowing of up to $25 million with BMO Harris as of December 31, 2023. For the year ended December 31, 2023, we paid off our $2.7 million loan outstanding with East West Bank.
Refer to Note 20 – Capital Requirements for more detail on our capital requirements. Siebert 2022 Form-10K 31 Cash Flows Cash provided by and used in operating activities consisted of net income (loss) adjusted for certain non-cash items.
Refer to Note 19 – Capital Requirements for more detail on our capital requirements. Cash Flows Cash provided by and used in operating activities consisted of net income (loss) adjusted for certain non-cash items.
Net Loss Attributable to Noncontrolling Interests As further discussed in Note 1 – Organization and Basis of Presentation, we consolidate RISE’s financial results into our financial statements and reflect the portion of RISE not held by Siebert as a noncontrolling interests in our financial statements.
Net Income (Loss) Attributable to Noncontrolling Interests As further discussed in Note 2 – Summary of Significant Accounting Policies, we consolidate RISE’s financial results into our consolidated financial statements and reflect the portion of RISE not held by Siebert as a noncontrolling interests in our consolidated financial statements.
Such changes in interest rates primarily impact revenue from interest, marketing, and distribution fees. We primarily earn interest, marketing and distribution fees from margin interest charged on clients’ margin balances, interest on cash and securities segregated for regulatory purposes, and distribution fees from money market mutual funds in clients’ accounts.
We primarily earn interest, marketing and distribution fees from margin interest charged on clients’ margin balances, interest on cash and securities segregated for regulatory purposes, and distribution fees from money market mutual funds in clients’ accounts. Securities segregated for regulatory purposes consist solely of U.S. government securities.
We seek to mitigate this risk by managing the average maturities of our U.S. government securities portfolio and setting risk parameters for securities owned, at fair value.
If prices of U.S. government securities within our portfolio decline, we anticipate the impact to be temporary as we intend to hold these securities to maturity. We seek to mitigate this risk by managing the average maturities of our U.S. government securities portfolio and setting risk parameters for securities owned, at fair value.
Stock borrow / stock loan for the year ended December 31, 2022 was $14,518,000 and increased by $2,654,000 from the corresponding period in the prior year primarily due to the growth of the business, expansion of our stock locate revenues, and additional securities lending and locate counterparty relationships.
Stock borrow / stock loan for the year ended December 31, 2023 was $16,172,000 and increased by $1,654,000 from the corresponding period in the prior year, primarily due to the growth of stock locate and securities lending businesses.
Principal transactions and proprietary trading for the year ended December 31, 2022 were $3,743,000 and decreased by $11,904,000 from the corresponding period in the prior year primarily due to the factors discussed below. The decrease in realized and unrealized gain on primarily riskless principal transactions was primarily due to weaker market conditions in 2022 within this business line.
Principal transactions and proprietary trading for the year ended December 31, 2023 were $13,094,000 and increased by $9,351,000 from the corresponding period in the prior year, primarily due to the factors discussed below. The increase in realized and unrealized gain on primarily riskless principal transactions was primarily due to market conditions.
Year Ended December 31, 2022 2021 (Year over Year Decrease) Principal transactions and proprietary trading Realized and unrealized gain on primarily riskless principal transactions $ 7,643,000 $ 15,675,000 $ (8,032,000 ) Unrealized loss on portfolio of U.S. government securities (3,900,000 ) (28,000 ) (3,872,000 ) Total Principal transactions and proprietary trading $ 3,743,000 $ 15,647,000 $ (11,904,000 ) Market making for the year ended December 31, 2022 was $2,443,000 and decreased by $3,454,000 from the corresponding period in the prior year primarily due to market conditions.
Year Ended December 31 2023 2022 Year over Year Increase Principal transactions and proprietary trading Realized and unrealized gain on primarily riskless principal transactions $ 9,275,000 $ 7,643,000 $ 1,632,000 Realized and unrealized gain (loss) on portfolio of U.S. government securities 3,819,000 (3,900,000 ) 7,719,000 Total Principal transactions and proprietary trading $ 13,094,000 $ 3,743,000 $ 9,351,000 Market making for the year ended December 31, 2023 was $1,304,000 and decreased by $1,139,000 from the corresponding period in the prior year, primarily due to market conditions.
Earnings of Equity Method Investment in Related Parties The earnings of equity method investment in related parties for the year ended December 31, 2022 was $4,000 and decreased by $168,000 from the corresponding period in the prior year primarily due to a decrease in the earnings of Tigress and our proportional income.
Non-Operating Income (Loss) The earnings of equity method investment in related party for the year ended December 31, 2023 was $111,000 and increased by $107,000 from the corresponding period in the prior year, primarily due to an increase in our proportional income from our investment in Tigress.
We believe that the critical accounting policies listed below are particularly subject to management's judgments and estimates and could materially affect our results of operations and financial position. Refer to Note 2 – Summary of Significant Accounting Policies for additional detail on our significant accounting policies.
The preparation of our consolidated financial statements requires us to make judgments and estimates that may have a significant impact on our financial results. We believe that the critical accounting policies listed below are particularly subject to management’s judgments and estimates and could materially affect our results of operations and financial position.
Advertising and promotion expense for the year ended December 31, 2022 was $543,000 and increased by $499,000 from the corresponding period in the prior year primarily due to an increase in promotional costs for various marketing initiatives.
Advertising and promotion expenses for the year ended December 31, 2023 were $155,000 and decreased by $388,000 from the corresponding period in the prior year, primarily due to a decrease in promotional costs for various marketing initiatives.
Our management team makes significant estimates that affect the reported amounts of assets, liabilities, revenues and expenses, and the related disclosure of contingent assets and liabilities included in the consolidated financial statements.
Critical Accounting Policies and Estimates We generally follow accounting policies standard in the brokerage industry and believe that our policies appropriately reflect our financial position and results of operations. Our management team makes significant estimates that affect the reported amounts of assets, liabilities, and expenses, and the related disclosure of contingent assets and liabilities included in the consolidated financial statements.
Siebert 2022 Form-10K 27 Data processing expenses for the year ended December 31, 2022 were $3,169,000 and increased by $320,000 from the corresponding period in the prior year primarily due to an increase in service bureau charges.
Siebert 2023 Form-10K 23 Data processing expenses for the year ended December 31, 2023 were $3,236,000 and increased by $67,000 from the corresponding period in the prior year.
On January 21, 2022, we purchased 20% of Hedge Connection, a woman-owned fintech company, and an option to acquire the remaining interest in Hedge Connection in exchange for consideration of $600,000 and 3.33% of RISE.As of the date of this Report, Siebert is currently evaluating the terms upon which it will transfer its remaining ownership of Tigress to Gloria E.
On January 21, 2022, we purchased 20% of Hedge Connection, a woman-owned fintech company, and an option to acquire the remaining interest in Hedge Connection in exchange for consideration of $600,000 and 3.33% of RISE. As part of these transactions, Tigress’ founder, Cynthia DiBartolo, continued as CEO of Tigress, and assumed the position as CEO of RISE. Gloria E.
The net loss attributable to noncontrolling interests for the year ended December 31, 2022 was $1,000,000, and increased by $970,000 from the corresponding period in the prior year due to an increase in RISE’s net loss for 2022 and Siebert’s ownership of RISE.
The net income attributable to noncontrolling interests for the year ended December 31, 2023 was $18,000, and increased by $1,018,000 from the corresponding period in the prior year, primarily due to expenses in RISE in 2022 associated with the exiting of the prime brokerage business.
Referral fees for the year ended December 31, 2022 were $0 and decreased by $1,213,000 from the corresponding period in the prior year primarily due to the loss of our institutional customers of RISE.
Clearing fees, including execution costs for the year ended December 31, 2023 were $1,672,000 and decreased by $471,000 from the corresponding period in the prior year, primarily due to the elimination of RISE clearing and execution charges.
Technology and communications expenses for the year ended December 31, 2022 were $4,471,000 and decreased by $291,000 from the corresponding period in the prior year primarily due to a decrease in technology costs related to RISE, partially offset by an increase in software licenses and other technology expenses.
Technology and communications expenses for the year ended December 31, 2023 were $3,364,000 and decreased by $1,107,000 from the corresponding period in the prior year, primarily due to a decrease in technology costs related to RISE as well as a decrease in costs related to an agreement with a technology vendor that was terminated in 2022.
Refer to Note 2 – Summary of Significant Accounting Policies and Note 3 – Transactions with Tigress and Hedge Connection for additional detail. Accruals for contingent liabilities Accruals for contingent liabilities related to legal and regulatory claims as well as employee healthcare expenses under our self-insured plan reflect an estimate of probable losses.
Siebert 2023 Form-10K 28 Accruals for contingent liabilities Accruals for contingent liabilities related to legal and regulatory claims as well as employee healthcare expenses under our self-insured plan reflect an estimate of probable losses.
Rent and occupancy expenses for the year ended December 31, 2022 were $1,955,000 and increased by $25,000 from the corresponding period in the prior year.
Rent and occupancy expenses for the year ended December 31, 2023 were $1,873,000 and decreased by $82,000 from the corresponding period in the prior year, primarily due to the elimination of certain leases in 2023.
We are not aware of any material differences between the estimates used in closing our books for the last five years and the actual amounts of revenue and expenses incurred when we subsequently receive the actual confirmations, invoices or other documentation.
We are not aware of any material differences between the estimates used in closing our books for the periods presented and the actual amounts of expenses incurred when we subsequently receive the actual confirmations, invoices or other documentation. Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Other income for the year ended December 31, 2022 was $2,825,000 and increased by $1,543,000 from the corresponding period in the prior year primarily due to an increase in income from consulting services and termination payment from a technology partner.
Advisory fees for the year ended December 31, 2023 were $1,928,000 and increased by $66,000 from the corresponding period in the prior year. Other income for the year ended December 31, 2023 was $1,898,000 and decreased by $1,064,000 from the corresponding period in the prior year, primarily due to the termination of consulting fee income from a technology vendor.
Statements of Financial Condition as of December 31, 2022 and 2021 Assets Assets as of December 31, 2022 were $728,048,000 and decreased by $676,187,000 from December 31, 2021, primarily due to a decrease in securities borrowed, receivables from customers, and cash and securities segregated for regulatory purposes, partially offset by an increase in cash and cash equivalents.
Siebert 2023 Form-10K 24 Consolidated Statements of Financial Condition as of December 31, 2023 and 2022 Assets Assets as of December 31, 2023 were $801,800,000 and increased by $73,752,000 from December 31, 2022, primarily due to an increase in securities borrowed, receivables from customers, and securities owned, at fair value, partially offset by a decrease in cash and cash equivalents.
Advisory fees for the year ended December 31, 2022 were $1,862,000 and increased by $194,000 from the corresponding period in the prior year primarily due to the expansion of the advisory business.
Depreciation and amortization expenses for the year ended December 31, 2023 were $2,020,000 and increased by $1,025,000 from the corresponding period in the prior year, primarily due to the write-off of certain technology assets in 2023.
Off-Balance Sheet Arrangements We enter into various transactions to meet the needs of customers, conduct trading activities, and manage market risks and are, therefore, subject to varying degrees of market and credit risk. In the normal course of business, our customer activities involve the execution, settlement, and financing of various customer securities transactions.
The total minimum expense for this arrangement is estimated at approximately $1.2 million over the duration of the contract. Off-Balance Sheet Arrangements We enter into various transactions to meet the needs of customers, conduct trading activities, and manage market risks and are, therefore, subject to varying degrees of market and credit risk.
As of the date of this Report, there are no known or material events that would require us to use large amounts of our liquid assets to cover expenses. Siebert 2022 Form-10K 29 Cash and Cash Equivalents Our cash and cash equivalents were $23.7 million and $3.8 million as of December 31, 2022 and 2021, respectively.
As of the date of this Report, there are no known or material events that would require us to use large amounts of our liquid assets to cover expenses. Kakaopay The net capital infusion from Kakaopay to Siebert from the First Tranche was approximately $14.8 million after the issuance cost.
Siebert 2022 Form-10K 25 Client Activity Metrics – Retail Customers Year Ended December 31, 2022 2021 Total retail trades 374,996 472,540 • Total retail trades represents retail trades that generate commissions Statements of Operations and Financial Condition Statements of Operations for the Year Ended December 31, 2022 and 2021 Revenue Commissions and fees for the year ended December 31, 2022 were $7,477,000 and decreased by $10,775,000 from the corresponding period in the prior year primarily due to the loss of institutional customers of RISE as well as market conditions during 2022.
Siebert 2023 Form-10K 22 Consolidated Statements of Operations and Financial Condition Consolidated Statements of Operations for the Years Ended December 31, 2023 and 2022 Revenue Commissions and fees for the year ended December 31, 2023 were $7,541,000 and increased by $201,000 from the corresponding period in the prior year, primarily due to market conditions.
Professional fees for the year ended December 31, 2022 were $3,202,000 and increased by $507,000 from the corresponding period in the prior year primarily due to an increase in legal and consulting fees related to certain transactions such as the unwinding of Tigress and Hedge Connection.
Professional fees for the year ended December 31, 2023 were $4,459,000 and increased by $1,257,000 from the corresponding period in the prior year, primarily due to an increase in board of director compensation, executive officer compensation, as well as other consulting costs.
Siebert 2022 Form-10K 28 Provision For (Benefit From) Income Taxes The benefit from income taxes for the year ended December 31, 2022 was $1,300,000 and decreased from the provision for income taxes by $3,021,000 from the corresponding period in the prior year. Refer to Note 19 – Income Taxes for further detail.
Provision For (Benefit From) Income Taxes The provision for income taxes for the year ended December 31, 2023 was $3,415,000 and increased from the benefit for income taxes by $4,715,000 from the corresponding period in the prior year.
Liabilities Liabilities as of December 31, 2022 were $678,128,000 and decreased by $675,601,000 from December 31, 2021, primarily due to a decrease in securities loaned, payables to customers, and notes payable – related party.
Liabilities Liabilities as of December 31, 2023 were $731,091,000 and increased by $52,963,000 from December 31, 2022, primarily due to an increase in securities loaned partially offset by a decrease in payables to customers and payables to non-customers.
Interest expense for the year ended December 31, 2022 was $440,000 and increased by $79,000 from the corresponding period in the prior year primarily due to additional interest incurred from the mortgage with East West Bank established in 2022.
Interest expense for the year ended December 31, 2023 was $263,000 and decreased by $177,000 from the corresponding period in the prior year, primarily due to the elimination in interest related to notes payable at the end of 2022.
Impairment of Equity Method Investment in Related Party Impairment of equity method investment in related party for the year ended December 31, 2022 was $4,015,000 and increased by $4,015,000 from the corresponding period in the prior year due to the impairment of our investment in Tigress.
Transaction termination costs for the year ended December 31, 2023 was $5,943,000 and increased by $5,943,000 from the corresponding period in the prior year due to costs associated with the termination of the Kakaopay transaction.
We have concluded that as of December 31, 2022 and 2021, there has been no impairment to the carrying value of Siebert’s goodwill; however, there has been an impairment of $4,015,000 to the carrying value of our equity method investment in Tigress for the year ended December 31, 2022, and an impairment of $699,000 to the RISE customer relationships intangible asset for the year ended December 31, 2021 due to the termination of GSCO’s clearing arrangement with RISE.
We have concluded that as of December 31, 2023 and 2022, there has been no impairment to the carrying value of Siebert’s goodwill; however, there has been an impairment to the carrying value of our investment in the Trading Technology Provider and our equity method investment in Tigress for the years ended December 31, 2023 and 2022, which is included in line item “Impairment of investments” on the consolidated statements of operations.
During 2022, there was an increase in U.S. government securities yields, which created an unrealized loss of approximately $3.9 million on our government securities portfolio for the year ended December 31, 2022.
The increase in unrealized gain on our portfolio of U.S. government securities was due to the following. We invested in 1-year treasury bills and 2-year treasury notes in order to enhance our yield on excess 15c3-3 deposits. During 2022, there was an increase in U.S. government securities yields, which created an unrealized loss on our U.S. government securities portfolio.
Other general and administrative expenses for the year ended December 31, 2022 were $4,010,000 and increased by $324,000 from the corresponding period in the prior year primarily due to an increase in travel and entertainment related to marketing initiatives for our corporate services and securities finance business lines, an increase in insurance costs, partially offset by a legal settlement occurring in 2021.
Other general and administrative expenses for the year ended December 31, 2023 were $4,410,000 and increased by $400,000 from the corresponding period in the prior year, primarily due to an increase in travel expenses as well as expense primarily related to the Miami office building.
We believe this new technology provider will be key to creating a platform for the next generation of retail customers and the termination of our original technology relationship had minimal impact on our current operations. Refer to Note 6 – Prepaid Service Contract for further detail on the accounting and financial impact of the termination of our original technology relationship.
We believe these changes will be key to creating a Retail Platform and additional technology services for the next generation of retail customers, correspondent clearing, as well as the overall growth of our business. The termination of agreements with our prior technology vendors had minimal impact on our current operations.
Siebert 2022 Form-10K 24 Client Account and Activity Metrics The following tables set forth metrics we use in analyzing our client account and activity trends for the periods indicated.
Refer to Note 3 – Transactions with Tigress and Hedge Connection for further detail on the terms and accounting treatment of these transactions. Client Account and Activity Metrics The following tables set forth metrics we use in analyzing our client account and activity trends for the periods indicated.
For the year ended December 31, 2022, we did not sell any shares pursuant to this Sales Agreement. Refer to Note 22 – Commitments, Contingencies, and Other for additional detail.
For the years ended December 31, 2023 and 2022, we did not sell any shares pursuant to this Sales Agreement. Refer to Note 21 – Commitments, Contingencies and Other for additional detail. As noted above, since we filed this Report after its scheduled due date, we no longer satisfy the eligibility requirements for use of registration statements on Form S-3.
New Accounting Standards Refer to Note 2 - Summary of Significant Accounting Policies for additional information regarding new Accounting Standards Updates (“ASU”s) issued by the Financial Accounting Standards Board (“FASB”). Siebert 2022 Form-10K 34
We are still evaluating the presentational effect that ASU 2023-09 will have on our consolidated financial statements, but we expect considerable changes to our income tax footnote. Refer to Note 2 – Summary of Significant Accounting Policies for additional information regarding new Accounting Standards Updates (“ASU”s) issued by the Financial Accounting Standards Board (“FASB”).
Operating Expenses Employee compensation and benefits for the year ended December 31, 2022 were $28,734,000 and decreased by $7,690,000 from the corresponding period in the prior year primarily due to a decrease in commissions payouts from RISE related to the loss of our institutional customers and a decrease in payouts related to fixed income, market making, and commission revenue, partially offset by an increase in payouts related to stock borrow / stock loan as well as an increase in executive compensation.
Operating Expenses Employee compensation and benefits for the year ended December 31, 2023 were $31,936,000 and increased by $3,202,000 from the corresponding period in the prior year, primarily due to an increase in commission payouts and incentive compensation.
Loss on impairment for the year ended December 31, 2022 was $0 and decreased by $699,000 from the corresponding period in the prior year primarily due to the impairment of our RISE customer relationships intangible asset due to the termination of our clearing arrangement with GSCO occurring in the third quarter of 2021.
The impairment of investments for the year ended December 31, 2023 was a loss of $1,035,000 and decreased by $2,980,000 from the corresponding period in the prior year, primarily due to the impairment of our investment in Tigress occurring in 2022, partially offset by the impairment in 2023 of our investment in a technology provider of a trading platform (“Trading Technology Provider”).
Interest, marketing and distribution fees for the year ended December 31, 2022 were $17,234,000 and increased by $4,337,000 from the corresponding period in the prior year, primarily due to a rising interest rate environment which increased margin interest, 12b-1 money market fees, as well as interest on U.S. treasuries and cash deposits within MSCO of an aggregate of $7.5 million, partially offset by the loss of interest income from institutional customers in RISE of $3.2 million.
Interest, marketing and distribution fees for the year ended December 31, 2023 were $29,577,000 and increased by $12,343,000 from the corresponding period in the prior year primarily due to rising interest rates that resulted in an increase in margin interest income and interest income received on U.S. government securities and bank deposits.
The total estimated cost for the build out is $1.5 million, with $338,000 financed through a commitment with East West Bank and the remainder being cash. As of December 31, 2022, we have incurred approximately $1.0 million out of the $1.5 million of the build out costs.
As of December 31, 2023, we have incurred approximately $129,000 out of the $800,000 of the estimated build out costs.
Vioni resigned from their respective positions within Siebert and RISE. The financial impact of these transactions with Tigress and Hedge Connection was a one-time loss of approximately $4.7M for the year ended December 31, 2022, of which $4.0M was due to an impairment of our investment in Tigress.
The financial impact of the transaction with Hedge Connection was a one-time loss of $719,000 for the year ended December 31, 2022, which is in the line item “Loss on sale of equity method investment in related party” on the consolidated statements of operations.
Removed
Gebbia pursuant to the Reorganization Agreement. Refer to Note 3 – Transactions with Tigress and Hedge Connection for further detail on the terms and accounting treatment of these transactions. Siebert 2022 Form-10K 23 As part of these transactions, Tigress’ founder, Cynthia DiBartolo, continued as CEO of Tigress, and assumed the position as CEO of RISE. Gloria E.
Added
Trends and Key Factors Affecting our Operations Interest Rates We are exposed to market risk from changes in interest rates. Such changes in interest rates primarily impact revenue from interest, marketing, and distribution fees.
Removed
These expenses are recorded in the line items “Impairment of equity method investment in related party” and “Loss on sale of equity method investment in related parties” in the statements of operations. Management is assessing the future strategic direction of RISE, taking into consideration current market conditions, demand trends, and resources.
Added
Technology Initiatives During 2022 and 2023 we terminated agreements with prior technology vendors that were primarily developing our Retail Platform, refer to Note 7 - Prepaid Service Contract and Note 10 – Software, Net for further detail.
Removed
Termination of Clearing Arrangements with GSCO and Pershing On August 30, 2021, Goldman Sachs & Co. LLC (“GSCO”) notified RISE that its clearing arrangement with RISE will be terminated. Due to the termination of RISE’s clearing arrangement with GSCO, substantially all the revenue producing customers of RISE have transitioned to other prime service providers.
Added
During 2023, we reassessed our technology needs and strategic direction and hired new technology personnel, changed our primary software development vendor, and made additional investments in technology development related to our Retail Platform and additional technology services for our customers.
Removed
Revenue and pre-tax income from customers that have transitioned to other prime service providers was approximately $12.6 million and $1.8 million, respectively, for the year ended December 31, 2021. As of December 31, 2022, we were in the process of terminating our clearing relationships with GSCO and Pershing LLC (“Pershing”).
Added
Recent Developments Transaction with Kakaopay On April 27, 2023, we entered into the First Tranche Stock Purchase Agreement with Kakaopay, a company established under the Laws of the Republic of Korea, pursuant to which we issued to Kakaopay 8,075,607 shares of our common stock at a per share price of Two Dollars Fifteen Cents ($2.15), which represented at the time of issuance 19.9% of our outstanding equity securities on a fully diluted basis (the “First Tranche”).
Removed
As of the date of this Report, we are no longer doing active business with these clearing vendors, and anticipate the full termination of these relationships by the end of the first quarter of 2023. Interest Rates We are exposed to market risk from changes in interest rates.
Added
Concurrent with the execution of the First Tranche Stock Purchase Agreement, Siebert and Kakaopay entered into a Stock Purchase Agreement (the “Second Tranche Stock Purchase Agreement”), pursuant to which we agreed to issue to Kakaopay additional shares at a per share price of Two Dollars Thirty Five Cents ($2.35), that would have resulted in Kakaopay owning 51% of the outstanding equity securities of Siebert on a fully diluted basis.
Removed
Securities segregated for regulatory purposes consist solely of U.S. government securities. If prices of U.S. government securities within our portfolio decline, we anticipate the impact to be temporary as we intend to hold these securities to maturity.
Added
Siebert 2023 Form-10K 20 The First Tranche closed on May 18, 2023 and, in connection therewith, we entered into the Registration Rights Agreement and a Stockholders’ Agreement (the “Original Stockholders’ Agreement”) with Kakaopay. On December 19, 2023, we entered into a Termination and Settlement Agreement (the “Settlement Agreement”) with Kakaopay, Kakaopay Securities Corp.
Removed
Technology Partner In third quarter of 2022, we reassessed our technology needs and entered into a software license agreement with a different technology provider for the development of a new retail trading platform which will replace our current platforms and resulted in the termination of our original technology relationship.
Added
(“Kakaopay Securities”), MSCO and certain Gebbia parties named therein. Under the Settlement Agreement, the parties mutually agreed to terminate the Second Tranche Stock Purchase Agreement.
Removed
The increase in unrealized loss on our portfolio of U.S. government securities was due to the following.
Added
The parties terminated the Second Tranche Stock Purchase Agreement after reaching a compromise regarding their disagreement over, among other things, the occurrence of a “Purchaser Material Adverse Effect” in the Second Tranche Stock Purchase Agreement, and the ability of the closing conditions in the Second Tranche Stock Purchase Agreement to be satisfied.
Removed
Siebert 2022 Form-10K 26 In 2022 Siebert invested in treasury bill and treasury notes which are primarily in the line item “Cash and securities segregated for regulatory purposes” on the statements of financial condition, in order to enhance its yield on its excess 15c3-3 deposits.
Added
Certain related agreements were also terminated, including the Foreign Broker-Dealer Fee Sharing Agreement, dated April 27, 2023, between MSCO and Kakaopay Securities, and the Support and Restrictive Covenant Agreements by certain Gebbia stockholders, each dated April 27, 2023.
Removed
The aggregate unrealized loss of on the portfolio will be returned over the duration of the government securities, at a point no later than the maturity of the securities, the latest maturity being August 2024.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeWe are exposed to the risk of loss on unsettled customer transactions if customers and other counterparties are unable to fulfill their contractual obligations. There were no material losses for unsettled customer transactions in the last five years. Siebert 2022 Form-10K 35
Biggest changeWe are exposed to the risk of loss on unsettled customer transactions if customers and other counterparties are unable to fulfill their contractual obligations. There were no material losses for unsettled customer transactions in the last five years. Siebert 2023 Form-10K 29
While the value of the government securities may be subject to material changes in value, we believe any reduction in value would be temporary since the securities would mature at par value. Customer transactions are cleared through clearing brokers on a fully disclosed basis and are also self-cleared by MSCO.
While the value of the U.S. government securities may be subject to material changes in value, we believe any reduction in value would be temporary since the securities would mature at par value. Customer transactions are cleared through clearing brokers on a fully disclosed basis and are also self-cleared by MSCO.

Other SIEB 10-K year-over-year comparisons