TCI Founder Denies Company Broke Massachusetts Laws

The founder of Irvine-based TCI Corp. denies his investment firm broke any laws in Massachusetts by teaching people how to analyze the stock market.

Regulators with the Massachusetts Securities Division asked the secretary of state’s office to stop TCI from soliciting customers in Massachusetts, and impose fines for allegedly using deceptive marketing in newspapers and over the Internet.

Securities regulators accused TCI of soliciting customers to invest in a Ponzi scheme and failing to register with the state as an investment advisor.

But Tim Cho, principal officer of TCI, says his company doesn’t trade securities or accept money to trade on behalf of clients. His business is only to teach people how to analyze the market, he said in a telephone interview.

He said Massachusetts regulators “never talked to us or had a meeting with us. We never had any complaints from anyone,” Cho said. “We are a very reputable company.”

TCI offers training to retailers who want to get into day trading. But it’s a high-risk business, and the state has been cracking down on those who practice it as part of an effort to protect consumers who may not understand what they are getting into.

In California, the state Department of Corporations said Wednesday that it is investigating whether Cho provided investment advice without a license by training investors to engage in day trading of stocks, options and other securities.

Cho said he doesn’t need state or federal securities licenses because he is teaching--not advising--investors about stocks or helping them execute trades.