The SEC is bringing expenses in opposition to Cantor Fitzgerald, led by Trump's Commerce Secretary

Howard Lutnick, Chairman and CEO of BGC Partners Inc., speaks during the Piper Sandler Global Exchange and FinTech Conference in New York City, United States, June 8, 2022.

Brendan McDermid | Reuters

WASHINGTON – The Securities and Exchange Commission on Thursday charged global financial services provider Cantor Fitzgerald with violating laws related to regulatory disclosures by so-called blank-check companies before they raise money from the public.

Cantor Chairman and CEO Howard Lutnick was recently appointed by President-elect Donald Trump to head the Commerce Department. Lutnick is co-chair of Trump's transition team.

Cantor agreed to settle the SEC's charges by agreeing to pay a $6.75 million civil penalty and not to violate the securities laws at issue in the case.

The Company has neither admitted nor denied the allegations, which relate to certain anti-fraud and proxy provisions of the federal securities laws.

Cantor's settlement mirrors an $18 million settlement that another blank-check company, Digital World Acquisition Corp., agreed to pay to the SEC in July 2023 after it was charged with fraud for failing to disclose to investors that DWAC had held extensive merger discussions with Trump's then-private social media company, Trump media. DWAC merged with Trump Media earlier this year.

It was unclear Thursday evening whether the Trump transition review team was aware of the SEC's investigation into Cantor when the president-elect said he had chosen Lutnick to be commerce secretary.

Cantor Fitzgerald Chairman and CEO Howard Lutnick gestures as he speaks during a rally for Republican presidential candidate and former U.S. President Donald Trump at Madison Square Garden in New York, United States, October 27, 2024.

Andrew Kelly | Reuters

In an SEC order released Thursday, Cantor found that Cantor caused two blank-check companies, also known as SPACs, to falsely deny in regulatory filings that they had made contact with potential merger targets or substantive transactions before those SPACs went public had discussions with potential merger targets.

SPACs are shell companies that have no underlying business before potentially merging with a target company that does have operations.

The two SPACs, controlled by a team of Cantor executives, raised $750 million from investors through initial public offerings before merging with smart glass maker View and Satellite logicthe satellite imagery and geospatial data company, the SEC said.

The SEC said the team of Cantor executives and employees of Cantor subsidiaries searched for potential companies for the merger of the two SPACs and had “substantial discussions” with potential target companies. These discussions took place before the blank check companies registered and began their IPOs.

View's agreement to merge with Cantor SPAC CF Finance Acquisition Corp. was announced in November 2020. Satellogic's agreement to merge with CF Acquisition Corp. V was announced in July 2021.

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“This enforcement action reflects the clear message that all disclosures about substantive conversations with potential targets must be materially accurate,” Sanjay Wadhwa, acting director of the SEC’s Division of Enforcement, said Thursday.

“Cantor Fitzgerald misled investors about a critical investment consideration by repeatedly stating in public filings that the company had not identified or approached potential merger targets, despite having had substantive discussions about a possible merger with several private companies, including with the companies with which the SPACs were closed eventually merged,” Wadhwa said in a statement.

Cantor spokeswoman Erica Chase said in an email to CNBC: “No investor has ever been harmed by the alleged issues described in the order.”

“We are pleased to have resolved this matter by mutual agreement with the SEC,” Chase said.

The Trump transition did not immediately respond to a request for comment on the case.