Kcd Financial, Inc..

Includes form instructions and options. Options shown in this text do not identify which boxes were selected.

GENERAL INSTRUCTIONS
This Disclosure Reporting Page (DRP ADV) is an 
INITIAL OR
AMENDED response used to report details for affirmative responses to Items 11.C., 11.D.,
11.E., 11.F. or 11.G. of Form ADV.
Regulatory Action
Check item(s) being responded to:
11.C(1)
11.C(2)
11.C(3)
11.C(4)
11.C(5)
11.D(1)
11.D(2)
11.D(3)
11.D(4)
11.D(5)
11.E(1)
11.E(2)
11.E(3)
11.E(4)
11.F.
11.G.
Use a separate DRP for each event or proceeding . The same event or proceeding may be reported for more than one person or entity using one DRP. File
with a completed Execution Page. 
One event may result in more than one affirmative answer to Items 11.C., 11.D., 11.E., 11.F. or 11.G. Use only one DRP to report details related to the
same event. If an event gives rise to actions by more than one regulator, provide details for each action on a separate DRP.
PART I
A.  The person(s) or entity(ies) for whom this DRP is being filed is (are):
You (the advisory firm)
You and one or more of your advisory affiliates
One or more of your advisory affiliates
If this DRP is being filed for an advisory affiliate, give the full name of the advisory affiliate below (for individuals, Last name, First name, Middle name). 
If the advisory affiliate has a CRD number, provide that number. If not, indicate "non-registered" by checking the appropriate box.
ADV DRP - ADVISORY AFFILIATE
CRD
Number:
1372334
This advisory affiliate is 
a Firm
an Individual
Registered:
Yes
No
Name:
BLUMENSCHEIN, JOEL REID
(For individuals, Last, First,
Middle)
This DRP should be removed from the ADV record because the advisory affiliate(s) is no longer associated with the adviser.
This DRP should be removed from the ADV record because: (1) the event or proceeding occurred more than ten years ago or (2) the adviser is
registered or applying for registration with the SEC or reporting as an exempt reporting adviser with the SEC and the event was resolved in the
adviser's or advisory affiliate's favor.
If you are registered or registering with a state securities authority , you may remove a DRP for an event you reported only in response to Item
11.D(4), and only if that event occurred more than ten years ago. If you are registered or registering with the SEC, you may remove a DRP for any
event listed in Item 11 that occurred more than ten years ago.
This DRP should be removed from the ADV record because it was filed in error, such as due to a clerical or data-entry mistake. Explain the
circumstances: 

B.
If the advisory affiliate is registered through the IARD system or CRD system, has the advisory affiliate submitted a DRP (with Form ADV, BD or U-4) to
the IARD or CRD for the event? If the answer is "Yes," no other information on this DRP must be provided.
 Yes
 No
NOTE: The completion of this form does not relieve the advisory affiliate of its obligation to update its IARD or CRD records.
PART II
1.  Regulatory Action initiated by:
SEC   
Other Federal   
State   
SRO
Foreign
(Full name of regulator, foreign financial regulatory authority, federal, state, or SRO) 
2.
Principal Sanction:
Other Sanctions: 
3.
Date Initiated (MM/DD/YYYY): 
 Exact
 Explanation
If not exact, provide explanation:
4.
Docket/Case Number:
5.
Advisory Affiliate Employing Firm when activity occurred which led to the regulatory action (if applicable):
6.
Principal Product Type:
Other Product Types: 
7.
Describe the allegations related to this regulatory action (your response must fit within the space provided):
8.
Current Status?      
 Pending
 On Appeal
 Final
9.
If on appeal, regulatory action appealed to (SEC, SRO, Federal or State Court) and Date Appeal Filed:
If Final or On Appeal, complete all items below. For Pending Actions, complete Item 13 only.
10. How was matter resolved:
11. Resolution Date (MM/DD/YYYY):
 Exact
 Explanation
If not exact, provide explanation:
12. Resolution Detail:
A.  Were any of the following Sanctions Ordered (check all appropriate items)?
 Monetary/Fine Amount: $
 Revocation/Expulsion/Denial
 Disgorgement/Restitution
 Censure
 Cease and Desist/Injunction
 Bar
 Suspension
B.
Other Sanctions Ordered:
Sanction detail: if suspended, enjoined or barred, provide duration including start date and capacities affected (General Securities Principal,
Financial Operations Principal, etc.). If requalification by exam/retraining was a condition of the sanction, provide length of time given to
requalify/retrain, type of exam required and whether condition has been satisfied. If disposition resulted in a fine, penalty, restitution,
disgorgement or monetary compensation, provide total amount, portion levied against you or an advisory affiliate, date paid and if any portion
of penalty was waived: 
13. Provide a brief summary of details related to the action status and (or) disposition and include relevant terms, conditions and dates (your response
must fit within the space provided).

Includes form instructions and options. Options shown in this text do not identify which boxes were selected.

GENERAL INSTRUCTIONS
This Disclosure Reporting Page (DRP ADV) is an 
INITIAL OR
AMENDED response used to report details for affirmative responses to Items 11.C., 11.D.,
11.E., 11.F. or 11.G. of Form ADV.
Regulatory Action
Check item(s) being responded to:
11.C(1)
11.C(2)
11.C(3)
11.C(4)
11.C(5)
11.D(1)
11.D(2)
11.D(3)
11.D(4)
11.D(5)
11.E(1)
11.E(2)
11.E(3)
11.E(4)
11.F.
11.G.
Use a separate DRP for each event or proceeding . The same event or proceeding may be reported for more than one person or entity using one DRP. File
with a completed Execution Page. 
One event may result in more than one affirmative answer to Items 11.C., 11.D., 11.E., 11.F. or 11.G. Use only one DRP to report details related to the
same event. If an event gives rise to actions by more than one regulator, provide details for each action on a separate DRP.
PART I
A.  The person(s) or entity(ies) for whom this DRP is being filed is (are):
You (the advisory firm)
You and one or more of your advisory affiliates
One or more of your advisory affiliates
If this DRP is being filed for an advisory affiliate, give the full name of the advisory affiliate below (for individuals, Last name, First name, Middle name). 
If the advisory affiliate has a CRD number, provide that number. If not, indicate "non-registered" by checking the appropriate box.
ADV DRP - ADVISORY AFFILIATE
No Information Filed
This DRP should be removed from the ADV record because the advisory affiliate(s) is no longer associated with the adviser.
This DRP should be removed from the ADV record because: (1) the event or proceeding occurred more than ten years ago or (2) the adviser is
registered or applying for registration with the SEC or reporting as an exempt reporting adviser with the SEC and the event was resolved in the
adviser's or advisory affiliate's favor.
If you are registered or registering with a state securities authority , you may remove a DRP for an event you reported only in response to Item
11.D(4), and only if that event occurred more than ten years ago. If you are registered or registering with the SEC, you may remove a DRP for any
event listed in Item 11 that occurred more than ten years ago.
This DRP should be removed from the ADV record because it was filed in error, such as due to a clerical or data-entry mistake. Explain the
circumstances: 
B.
If the advisory affiliate is registered through the IARD system or CRD system, has the advisory affiliate submitted a DRP (with Form ADV, BD or U-4) to
the IARD or CRD for the event? If the answer is "Yes," no other information on this DRP must be provided.
 Yes
 No
NOTE: The completion of this form does not relieve the advisory affiliate of its obligation to update its IARD or CRD records.
PART II
1.  Regulatory Action initiated by:
SEC   
Other Federal   
State   
SRO
Foreign
(Full name of regulator, foreign financial regulatory authority, federal, state, or SRO) 
STATE OF NEVADA, OFFICE OF THE SECRETARY OF STATE, SECURITIES DIVISION
2.
Principal Sanction:
Civil and Administrative Penalt(ies) /Fine(s)
Other Sanctions: 
3.
Date Initiated (MM/DD/YYYY): 
09/28/2011
 Exact
 Explanation
If not exact, provide explanation:
4.
Docket/Case Number:
CI11-174-LJB

5.
Advisory Affiliate Employing Firm when activity occurred which led to the regulatory action (if applicable):
6.
Principal Product Type:
No Product
Other Product Types: 
7.
Describe the allegations related to this regulatory action (your response must fit within the space provided):
KCD WAS IN VIOLATION OF NRS 90.310(2), TO WIT, "IT IS UNLAWFUL FOR ANY ISSUER OR ANY BROKER-DEALER LICENSED UNDER THIS CHAPTER TO
EMPLOY OR CONTRACT WITH A PERSON AS A SALES REPRESENTATIVE WITHIN THIS STATE UNLESS THE SALES REPRESENTATIVE IS LICENSED OR
EXEMPT FROM LICENSING UNDER THIS CHAPTER." KCD PAID TWO SALES REPRESENTATIVES TRANSACTION BASED PAYMENTS ON SECURITIES
PRODUCTS WHEN THEY WERE NOT LICENSED IN NEVADA.
8.
Current Status?      
 Pending
 On Appeal
 Final
9.
If on appeal, regulatory action appealed to (SEC, SRO, Federal or State Court) and Date Appeal Filed:
If Final or On Appeal, complete all items below. For Pending Actions, complete Item 13 only.
10. How was matter resolved:
Consent
11. Resolution Date (MM/DD/YYYY):
06/29/2012
 Exact
 Explanation
If not exact, provide explanation:
12. Resolution Detail:
A.  Were any of the following Sanctions Ordered (check all appropriate items)?
 Monetary/Fine Amount: $ 62,445.66
 Revocation/Expulsion/Denial
 Disgorgement/Restitution
 Censure
 Cease and Desist/Injunction
 Bar
 Suspension
B.
Other Sanctions Ordered:
Sanction detail: if suspended, enjoined or barred, provide duration including start date and capacities affected (General Securities Principal,
Financial Operations Principal, etc.). If requalification by exam/retraining was a condition of the sanction, provide length of time given to
requalify/retrain, type of exam required and whether condition has been satisfied. If disposition resulted in a fine, penalty, restitution,
disgorgement or monetary compensation, provide total amount, portion levied against you or an advisory affiliate, date paid and if any portion
of penalty was waived: 
ALL FEES ARE PAID IN FULL.
13. Provide a brief summary of details related to the action status and (or) disposition and include relevant terms, conditions and dates (your response
must fit within the space provided).
THE VIOLATION OCCURRED AS A RESULT OF A CONTRACT PROVISION THAT WAS CREATED BY A PREVIOUS OWNER OF THE FIRM (NOW DECEASED).
FOLLOWING ACQUISITION, THE NEW OWNERS OF THE FIRM WERE UNABLE TO LOCATE ANY REFERENCES TO THE OFFENDING PROVISION AS THE
PREVIOUS OWNER HAD RETAINED THE AGREEMENT IN THE REP FILE. BOTH THE FIRM AND THE NEVADA REGISTERED REPRESENTATIVE WERE
APPROPRIATELY LICENSED IN NEVADA. THE TWO OTHER REGISTERED REPRESENTATIVES SUBJECT TO THE FINE (LICENSED IN ARIZONA BUT NOT
NEVADA) WERE COLLECTING RECRUITING OVERRIDES FROM THE NEVADA LICENSED REGISTERED REPRESENTATIVE. UPON RECEIPT OF NOFIFICATION,
THE FIRM REVERSED THE OVERRIDES PAID TO THE RR'S (AND THE FIRM) AND REMITTED $62,445.66 TO THE STATE OF NEVADA. THE AMOUNT ASSESSED
TO THE FIRM WAS $20,000 AND $42,445.66 WAS ASSESSED TO THE RR'S THUS RESOLVING THE ISSUE.

Includes form instructions and options. Options shown in this text do not identify which boxes were selected.

GENERAL INSTRUCTIONS
This Disclosure Reporting Page (DRP ADV) is an 
INITIAL OR
AMENDED response used to report details for affirmative responses to Items 11.C., 11.D.,
11.E., 11.F. or 11.G. of Form ADV.
Regulatory Action
Check item(s) being responded to:
11.C(1)
11.C(2)
11.C(3)
11.C(4)
11.C(5)
11.D(1)
11.D(2)
11.D(3)
11.D(4)
11.D(5)
11.E(1)
11.E(2)
11.E(3)
11.E(4)
11.F.
11.G.

Use a separate DRP for each event or proceeding . The same event or proceeding may be reported for more than one person or entity using one DRP. File
with a completed Execution Page. 
One event may result in more than one affirmative answer to Items 11.C., 11.D., 11.E., 11.F. or 11.G. Use only one DRP to report details related to the
same event. If an event gives rise to actions by more than one regulator, provide details for each action on a separate DRP.
PART I
A.  The person(s) or entity(ies) for whom this DRP is being filed is (are):
You (the advisory firm)
You and one or more of your advisory affiliates
One or more of your advisory affiliates
If this DRP is being filed for an advisory affiliate, give the full name of the advisory affiliate below (for individuals, Last name, First name, Middle name). 
If the advisory affiliate has a CRD number, provide that number. If not, indicate "non-registered" by checking the appropriate box.
ADV DRP - ADVISORY AFFILIATE
No Information Filed
This DRP should be removed from the ADV record because the advisory affiliate(s) is no longer associated with the adviser.
This DRP should be removed from the ADV record because: (1) the event or proceeding occurred more than ten years ago or (2) the adviser is
registered or applying for registration with the SEC or reporting as an exempt reporting adviser with the SEC and the event was resolved in the
adviser's or advisory affiliate's favor.
If you are registered or registering with a state securities authority , you may remove a DRP for an event you reported only in response to Item
11.D(4), and only if that event occurred more than ten years ago. If you are registered or registering with the SEC, you may remove a DRP for any
event listed in Item 11 that occurred more than ten years ago.
This DRP should be removed from the ADV record because it was filed in error, such as due to a clerical or data-entry mistake. Explain the
circumstances: 
B.
If the advisory affiliate is registered through the IARD system or CRD system, has the advisory affiliate submitted a DRP (with Form ADV, BD or U-4) to
the IARD or CRD for the event? If the answer is "Yes," no other information on this DRP must be provided.
 Yes
 No
NOTE: The completion of this form does not relieve the advisory affiliate of its obligation to update its IARD or CRD records.
PART II
1.  Regulatory Action initiated by:
SEC   
Other Federal   
State   
SRO
Foreign
(Full name of regulator, foreign financial regulatory authority, federal, state, or SRO) 
FINRA
2.
Principal Sanction:
Other
Other Sanctions: 
MONETARY FINE AND CENSURE
3.
Date Initiated (MM/DD/YYYY): 
11/14/2013
 Exact
 Explanation
If not exact, provide explanation:
4.
Docket/Case Number:
2011025851501
5.
Advisory Affiliate Employing Firm when activity occurred which led to the regulatory action (if applicable):
6.
Principal Product Type:
CD(s)
Other Product Types: 
MEMBERSHIP INTERESTS
7.
Describe the allegations related to this regulatory action (your response must fit within the space provided):
ACTED IN CONTRAVENTION OF SECTION 5 OF THE SECURITIES ACT OF 1933, WILLFULLY VIOLATED SEC RULES 17A-4(B)(4), 17A-4(F)(2), VIOLATED
FINRA RULE 2010, NASD RULES 2210, 3010, 3110: THE FIRM WAS AWARE OF REGISTERED REPRESENTATIVES' USE OF CERTIFICATES OF DEPOSIT (CD)
ADVERTISEMENTS TO ATTRACT CUSTOMERS TO ITS BRANCH OFFICES, AND PERMITTED THESE REPRESENTATIVES TO PLACE FALSE AND MISLEADING

ADVERTISEMENTS FOR PRODUCTS THAT DID NOT EXIST, WITH MISLEADING, EXAGGERATED AND UNWARRANTED STATEMENTS. THE FIRM PERMITTED
THESE REPRESENTATIVES TO PLACE THE CD ADVERTISEMENTS WITHOUT INCLUDING THE NAME OF THE FIRM AS THE BROKER-DEALER. THE
REPRESENTATIVES ADVERTISED THE FDIC-INSURED CDS THAT DID NOT EXIST, WITH ANNUAL PERCENTAGE YIELDS ABOVE MARKET RATES. SOME OF
THE REPRESENTATIVES PRIMARILY CATERED TO SENIOR CITIZENS AND USED NEWSPAPER CD ADVERTISEMENTS TO ATTRACT POTENTIAL CUSTOMERS
TO THE BRANCH, WHILE THEY INTENDED TO OFFER THE CUSTOMERS DIFFERENT SECURITIES PRODUCTS, FIXED ANNUITIES, AND FIXED INSURANCE
PRODUCTS. ANOTHER REPRESENTATIVE USED THE CD ADVERTISEMENTS TO ATTRACT HIS CUSTOMERS TO THE OFFICE TO DISCUSS REAL ESTATE
INVESTMENT TRUSTS (REITS), ANNUITIES, OR OTHER COMMISSION-BASED PRODUCTS. ABOUT 95 PERCENT OF THESE CUSTOMERS WERE SENIOR
CITIZENS. CERTAIN REGISTERED REPRESENTATIVES OF THE FIRM, DOING BUSINESS AS A COMPANY, SOLD MEMBERSHIP INTERESTS IN AN ENTITY. THE
MEMBERSHIP INTERESTS IN THE ENTITY WERE UNREGISTERED SECURITIES, PURPORTEDLY SOLD PURSUANT TO THE EXEMPTION FROM REGISTRATION
IN SECTION 506 OF REGULATION D. A NEWSPAPER ARTICLE ON THE REPRESENTATIVES' COMPANY'S WEBSITE ADVERTISED THE ENTITY'S OFFERING BY
NAME DURING THE SOLICITATION STAGE AND, THEREFORE, CONSTITUTED A GENERAL SOLICITATION IN CONTRAVENTION OF REGULATION D. THE FIRM
NEGLECTED TO SUPERVISE THE ADVERTISING ACTIVITIES OF ITS REGISTERED REPRESENTATIVES AND DID NOT LEARN OF OR INVESTIGATE THE
GENERAL SOLICITATION OF THE ENTITY'S OFFERING IN THE REFERENCED NEWSPAPER ARTICLE ON THE COMPANY'S WEBSITE. AS SUCH, THE FIRM
FAILED TO REASONABLY SUPERVISE THE ENTITY'S OFFERING BY THE REPRESENTATIVES' COMPANY. THE REGISTERED REPRESENTATIVES AT THE
COMPANY RAISED APPROXIMATELY $2.473 MILLION FROM INVESTORS, FOR THE ENTITY. THE FIRM ALLOWED ITS REGISTERED REPRESENTATIVES TO
UTILIZE PERSONAL EMAIL ACCOUNTS FOR BUSINESS PURPOSES, BUT REQUIRING THEM TO BLIND CARBON COPY ('BCC') THE DESIGNATED PRINCIPAL
OR DESIGNATED EMAIL ADDRESS FOR REVIEW ON ALL OUTGOING COMMUNICATIONS, AND REQUIRING THEM TO FORWARD ALL INCOMING
CORRESPONDENCE TO THE DESIGNATED PRINCIPAL. HOWEVER, THE FIRM HAD NO SYSTEM IN PLACE TO PREVENT OR DETECT NONCOMPLIANCE. THUS,
THE FIRM'S EMAIL RETENTION AND REVIEW PROCESS WAS INADEQUATE BECAUSE IT WAS NOT REASONABLY DESIGNED TO SUPERVISE EACH
REGISTERED REPRESENTATIVE. THE FIRM WILLFULLY VIOLATED SEC RULES WHEN IT DID NOT RETAIN ANY OF ITS REGISTERED REPRESENTATIVES'
EMAIL COMMUNICATIONS FOR OVER THREE YEARS IN AN ELECTRONIC FORMAT FROM WHICH THEY WERE EASILY ACCESSIBLE OR READILY
DOWNLOADABLE FOR A PERIOD OF AT LEAST TWO YEARS. THE FIRM FAILED TO COMPLY WITH ITS OWN WRITTEN PROCEDURES IN THAT IT FAILED TO
MAINTAIN EVIDENCE OF SUPERVISORY REVIEW OF EMPLOYEE EMAILS.
8.
Current Status?      
 Pending
 On Appeal
 Final
9.
If on appeal, regulatory action appealed to (SEC, SRO, Federal or State Court) and Date Appeal Filed:
ON 7/9/15 PANEL DECISION WAS APPEALED TO THE NAC ON 8/26/16 NAC DECISION WAS APPEALED TO THE SEC ON 3/29/17 SEC DECISION WAS
ISSUED TO THE FIRM
If Final or On Appeal, complete all items below. For Pending Actions, complete Item 13 only.
10. How was matter resolved:
Decision
11. Resolution Date (MM/DD/YYYY):
05/30/2017
 Exact
 Explanation
If not exact, provide explanation:
THE ORIGINAL OFFER TO SETTLE WAS ON 12/16/2014. ON 6/16/15, THE HEARING PANEL RENDERED THEIR DECISION ON COUNT 1 AND 2 OF THE
ENFORCEMENT ACTION. ON 8/3/16 THE NAC RENDERED ITS DECISION VACATING COUNT 1 OF THE ENFORCEMENT ACTION AND AMENDING THE FINE TO
THE FIRM $73,000. 8/26/16 FIRM APPEALED DECISION TO THE SEC ON COUNT 2 ON 3/29/2017 THE SEC UPHELD THE NAC FINDING AND FINE OF
$73,000.
12. Resolution Detail:
A.  Were any of the following Sanctions Ordered (check all appropriate items)?
 Monetary/Fine Amount: $ 78,000.00
 Revocation/Expulsion/Denial
 Disgorgement/Restitution
 Censure
 Cease and Desist/Injunction
 Bar
 Suspension
B.
Other Sanctions Ordered:
Sanction detail: if suspended, enjoined or barred, provide duration including start date and capacities affected (General Securities Principal,
Financial Operations Principal, etc.). If requalification by exam/retraining was a condition of the sanction, provide length of time given to
requalify/retrain, type of exam required and whether condition has been satisfied. If disposition resulted in a fine, penalty, restitution,
disgorgement or monetary compensation, provide total amount, portion levied against you or an advisory affiliate, date paid and if any portion
of penalty was waived: 
FINE IN THE AMOUNT OF $5,000 WAS PAID BY FIRM IN FULL ON 12/29/2014 FOR COUNT 3 OF THE ENFORCEMENT ACTION. ON COUNT 1 AND 2
THE PANEL FINED THE FIRM $115,000 PLUS COST OF $6,306.48. THE PANEL DECISION WAS APPEALED TO THE NAC. NAC VACATED HEARING
PANELS DECISION ON COUNT 1 OF THE ENFORCEMENT ACTION AND REDUCED THE FINE TO $73,000 ON COUNT 2. FIRM FILED APPEAL TO SEC
ON 8/26/16. SEC UPHELD THE SANCTIONS AND DECISION ISSUED BY THE NAC WITH REGARDS TO COUNT II OF ENFORCEMENT ACTION AND
UPHELD THE FINE OF $73,000 ON 3/29/2017.
13. Provide a brief summary of details related to the action status and (or) disposition and include relevant terms, conditions and dates (your response
must fit within the space provided).
ON COUNT III OF THE ACTION, FIRM ENTERED INTO AN AWC ($5,000 FINE) REGARDING FIRMS EMAIL REVIEW SYSTEM PRIOR TO SEPT 2011. ON 7/9/15
THE FIRM FILED AN APPEAL WITH THE NAC. NAC VACATED HEARING PANELS DECISION ON COUNT 1 OF THE ENFORCEMENT ACTION AND REDUCED THE
FINE TO $73,000 ON COUNT 2. FIRM FILED APPEAL ON COUNT 2 TO SEC ON 8/26/16. SEC UPHELD THE DECISION OF THE NAC AND THE FINE OF

$73,000. DECISION WAS SENT ON 3/29/2017.