Chief Compliance Officer (CCO) and Managing Partner
Frank E. Hartung, the Chief Compliance Officer (CCO) and Managing Partner of South Texas Securities Co. is also the founding member of the company. He started the company under the name Data Advisers Incorporated back in the year 1969 which was renamed to South Texas Securities Co. later on in the year 1975. Mr. Hartung started his initial days as a general securities representative more popularly called the stockbroker, duly licensed by the then self-regulatory market body National Association of Security Dealers (NASD) now known as the Financial Industry Regulatory Authority (FINRA) to buy and sell securities. His initial days were not without difficulties, disappointments, and failures. It took many slips and falls for Mr. Hartung to start having a grip on his entrepreneurial career. Mr. Hartung with his strong business acumen and his eye for good security products was soon climbing the ladder of success.
Mr. Hartung’s passion for understanding the newer businesses and its working model was a key to his success in identifying the right securities. Identifying the right securities may not be the only mantra to his success. The time when to enter an investment and when to exit is equally important in garnering success in the securities market. Mr. Hartung’s company has now started to manage the assets of hundreds of investors. The seed that was sowed in 1969 has sprouted and started spreading its roots deeper into financial markets, transforming itself from a plant to a tree. The stronghold of the company only increased thereafter.
Even though Mr. Hartung’s business was on the rise, so were the cases of fraud targeting naive investors. He raised his voice against fraudulent acts by individual brokers and advisors. Mr. Hartung knew the laws and regulations were lax and were not holding the brokers and advisors accountable. The brokers and advisors were taking advantage of the legislative loopholes. Mr. Hartung was very vocal not only on the crimes against investors but also on other social causes that include but not limited to child education, abuse, environment-related like pollution control and wildlife preservation. Mr. Hartung was not tolerant of any social injustice being played out. His social responsibility and passion towards society led him to the House of the Legislature for the first time in the year 1975, the same year he changed the name of his company to South Texas Securities Co. The change was not just in the name but in the approach of his company towards the betterment and representation of those investors defrauded by brokers. Mr. Hartung thought he would be able to bring in the required laws and regulations with the power of being a member of the Legislature, to govern and regulate the securities market to safeguard the rights and hard-earned money of the investor. During his multiple tenures in the House of the Legislature from 1975 to 1983, he was a member of various House committees whose primary objective was the interests of the public investors.
Mr. Hartung was an important member of the significant House Committee on Financial Institutions - 65th R.S. (1977) whose primary charges were:
A study of the feasibility and advantages of a state-owned and operated depository insurance corporation (SDIC) for financial institutions in this state.
A study of the statutes and regulations governing the operations of credit unions in the State with recommendations for necessary legislation, if any, to adequately protect the public through proper licensing, control and regulations. This study should also include a review of the impact of interest-bearing third party payments on all state financial institutions offering such instruments and the effect on the general public thereof.
A study of the various proposals for implementing an electronic funds transfer system in the state, with recommendations as to the advantages and disadvantages to such systems. This study should review the feasibility of electronic funds transfer systems including privacy aspects, security controls, and fraud potential.
Oversight responsibility of agency expenditures and related transactions. This function shall encompass a review and monitoring of all appropriations-related actions of those agencies assigned to this committee for appropriative purposes during the 65th Regular Session of the Legislature, to wit:
In the year 1979, Mr. Hartung was the Vice-chairperson in the House Committee on Financial Institutions - 66th R.S. (1979) whose primary charges were to:
Report on the status of the mortgage loan business in view of the change in usury limits enacted by the 66th Regular Session of the Legislature.
Compare the interest rate structures permitted by law for all lending institutions in Texas and compare these structures with those in selected states with similar regional and economic status to determine the impact of Texas usury ceilings and recommend revisions if needed.
Review the differences in state-chartered banks, national banks, and the bank holding companies as they relate to competition in the money market.
Study the status of credit unions in Texas, particularly with respect to their expansion, financial stability, and service to consumers.
Review the possible effects of the Depository Institutions Deregulation and Monetary Control Act of 1980 on state-chartered and federally chartered financial institutions in Texas.
Review the authority of the state and its political subdivisions regarding the receipt, deposit, investment and disposition of public funds in state and federally chartered financial institutions.
In the year 1981, Mr. Hartung served as the Chairperson in the House Committee on Financial Institutions - 67th R.S. (1981) whose primary charges were to:
Examine the possibility of allowing homeowners to mortgage homesteads.
Study the operation of collection agencies in Texas to determine the extent of extortionate and abusive collection tactics.
Study money market funds and their impact on the financial markets of Texas.
Study the Texas Housing Agency's on-going loan program and financial benefits to homeowners to determine if changes need to be made.
Study and report on the feasibility of repealing the present bank shares tax in its entirety and imposing a corporate franchise tax or some other equitable tax on banking corporations doing business in Texas.
Oversight functions shall be conducted for all appropriations-related actions of those agencies assigned to this committee for appropriative purposes during the 67th Regular Session of the Legislature. In addition, a study should be made of the impact of any federal cuts, and the differences in the operational aspect of the agencies under block vs. categorical grants. Close scrutiny should be given to each agency to ascertain if legislative intent is being carried out in the rules promulgated by the agency and if the rules are feasible and practical in their application. These agencies include:
Conduct and overall study of Texas' securities laws and determine if changes need to be made.
Examine the effect of the State Securities Board's practices and policies on small businesses in Texas.
Monitor the activities of the Sunset Commission as it deals with finance agencies during the interim.
Examine the installment purchases made by the State Purchasing and General Services Commission to determine if interest rates could be reduced by securing a tax-exempt status on installment sales.
In the year 1981, when his tenure as a member of the legislature came to an end he did not wish to contest the next term thereafter. He knew how politics played out and completely understood that power and greed were the rules of the game to which he did not give in. He always wanted to fight for the rights and safety of the investors and wanted to safeguard the investor’s rights and represent those who were defrauded of their hard-earned money. It was this long-time passion that led to the rise of the arbitration firm of the South Texas Securities Co. In the year 2018, Mr. Hartung became registered and licensed as the Chief Compliance Officer (CCO) of the firm and has passed the Securities Industry Essentials Examination as per the regulations of FINRA.
South Texas Securities Co. is a corporate and commercial litigation boutique. Our primary experience is the dynamic search of litigation claims for our clients. Furthermore to representing organizations and other investor claimants in action security litigation, the firm's skills set include general business and commercial litigation, as well as securities arbitration. Headed up by Mr. Hartung for over 50 years, we feel his insight and expertise in the industry can help investors identify potentially harmful agents and brokerages.
Some key areas investors can use are readily available and always on hand if individuals are unsure about potential firms, brokers or brokerages. Mr. Hartung states, “ The way information and technology have evolved, has given more people easy access to information that can potentially save their investments, using the internet is a great source as well as being time efficient.” He does, however have some reservations about the quality of the information provided.
Mr Hartung highlights that only by examining a large pool of brokers, investors can identify brokerages much more likely to harm buyers. He says, " It really is a common error to assume that because individual brokers can be found on websites and, in the aggregate, these details are useful for separating risky broker agents from lower-risk agents that useful information is publicly available. The creators of these sites need regulators to make sure such information is available in mass volume so researchers have simple metrics they can use to safeguard themselves.” All in all from our research the internet is a good place to start.
To finish he says, “ I hope people don’t have to use our services as we do hear some unfortunate stories from time to time, but we are always here to help and have the most up to date resources at our disposal.”
Chief Compliance Officer (CCO) and Managing Partner