In 1979, Rounds formed Consolidated Investment Services (CIS) as a licensed and registered broker/dealer and he served as president for 18 years. CIS was licensed in all states and had international offices and was in good standing with all federal and state regulatory agencies. Rounds was largely responsible for CIS’ success which grew to over 350 registered representatives (RR’s) or brokers and had over 20 branch offices. Throughout Rounds’ 40-year career as a top producing broker and the president of CIS he did not have one customer complaint filed against him.
CIS was co-founded by James L. Fainter. In 1990, Fainter and CIS lost an arbitration filed by one of Fainter’s retail clients. A $300,000 judgment was rendered against Fainter. Rounds paid the judgment in full for which Fainter relinquished his interest in CIS to Rounds. Fainter remained as a broker or Registered Representative (“RR”) and as a CIS branch manager. And he retained a five percent interest in CIS.
In the mid 80’s, Rounds successfully rescued Stanford Square Limited Partnership (Stanford), which consisted of 107 limited partners (investors). The Stanford Partnership owned a 70,000 square foot pristine commercial office building located in downtown Palo Alto, California. The original general partner, Barrick Group who was solely owned by Leslie Barth(Barth), a Harvard educated attorney. Barth misappropriated the investors’ funds. Rounds detected the fraud and worked in conjunction with the efforts of the Connecticut State Attorney General and with a vote of 100% by the limited partners became the new General Partner(GP)individually. The attorney general ultimately prosecuted and imprison Barth. Rounds became the new GP individually and was able to recover all of the investors’ equity in a 14-year effort.
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