What changed in this filing

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Item 1A. Risk Factors

2026-03-30 compared with 2025-03-31 · 440 added, 502 removed, 42 unchanged (96% of the section changed)

Regulatory Risks

Legislation has and may continue to result

in changes to rules and regulations applicable to our business, which may negatively impact our business and financial results.

New laws, rules, regulations

and guidance, or changes in the interpretation and enforcement of existing federal, state, foreign and SRO laws, rules, regulations and

guidance may directly affect our business and the profitability of Siebert or the operation of specific business lines.

In addition, new

and changing laws, rules, regulation and guidance could result in limitations on the lines of business we conduct, modifications to our

business practices, more stringent capital and liquidity requirements or other costs and could limit our ability to return capital to

stockholders.

The Dodd-Frank Act, enacted

in 2010, required many federal agencies to adopt new rules and regulations applicable to the financial services industry and called for

many studies regarding various industry practices.

In particular, the Dodd-Frank Act gave the SEC discretion to adopt rules regarding

standards of conduct for broker-dealers providing investment advice to retail customers.

The rules and interpretations

adopted by the SEC in June 2019 include Regulation Best Interest and the Form CRS Relationship Summary, which are intended to enhance

the quality and transparency of retail investors’ relationships with broker-dealers and investment advisers.

Regulation Best Interest

enhances the broker-dealer standard of conduct beyond existing suitability obligations, requiring compliance with disclosure, care, conflict

of interest and compliance obligations.

The regulation requires that a broker-dealer or natural person who is an associated person of

the broker-dealer shall act in the best interest of the retail customer at the time it makes a recommendation of any securities transaction

or investment strategy involving securities, prioritizing the interests of the customer above any interests of the broker-dealer or its

associated persons.

Among other things, this requires the broker-dealer to mitigate conflicts of interest arising from financial incentives

in selling securities products.

The new rules and processes

related thereto have and will most likely continue to involve increased costs, including, but not limited to, compliance costs associated

with new or enhanced technology.

In addition to the foregoing laws affecting regulation of our industry, Congress is considering various

proposals to increase taxation relating to investments, which may adversely impact the volume of trading and other transactions from which

we derive our revenue.

It is not possible to determine

the extent of the impact of any new laws, regulations or initiatives that may be imposed, or whether any existing proposals will become

Conformance with any new laws or regulations could make compliance more difficult and expensive and affect the manner in which we

conduct business.

We are subject to extensive government regulation

and to third party litigation risk and regulatory risk which could result in significant liabilities and reputational harm which, in turn,

could materially adversely affect our business, results of operations and financial condition.

Our business is subject to

extensive regulation in the U.S., at both the federal and state level.

We are also subject to regulation by SROs and other regulatory

bodies in the U.S., such as the SEC, the NYSE, FINRA, MSRB, the CFTC and the NFA.

MSCO is registered as a broker-dealer in 50 states,

the District of Columbia, and Puerto Rico, and RISE is registered as a broker-dealer in 7 states and territories.

The regulations to which

MSCO and RISE are subject as broker-dealers cover all aspects of the securities business including training of personnel, sales methods,

trading practices, uses and safe keeping of customers’ funds and securities, capital structure, record keeping, fee arrangements,

has and may continue to result in changes to rules and regulations applicable to our business, which may negatively impact our business

and financial results.

laws, rules, regulations and guidance, or changes in the interpretation and enforcement of existing federal, state, foreign and SRO laws,

rules, regulations and guidance may directly affect our business and the profitability of Siebert or the operation of specific business

In addition, new and changing laws, rules, regulation and guidance could result in limitations on the lines of business we conduct,

modifications to our business practices, more stringent capital and liquidity requirements or other costs and could limit our ability

to return capital to stockholders.

Dodd-Frank Act, enacted in 2010, required many federal agencies to adopt new rules and regulations applicable to the financial services

industry and called for many studies regarding various industry practices.

In particular, the Dodd-Frank Act gave the SEC discretion

to adopt rules regarding standards of conduct for broker-dealers providing investment advice to retail customers.

rules and interpretations adopted by the SEC in June 2019 include Regulation Best Interest and the Form CRS Relationship Summary, which

are intended to enhance the quality and transparency of retail investors’ relationships with broker-dealers and investment advisers.

Regulation Best Interest enhances the broker-dealer standard of conduct beyond existing suitability obligations, requiring compliance

with disclosure, care, conflict of interest and compliance obligations.

The regulation requires that a broker-dealer or natural person

who is an associated person of the broker-dealer shall act in the best interest of the retail customer at the time it makes a recommendation

of any securities transaction or investment strategy involving securities, prioritizing the interests of the customer above any interests

of the broker-dealer or its associated persons.

Among other things, this requires the broker-dealer to mitigate conflicts of interest

arising from financial incentives in selling securities products.

new rules and processes related thereto have and will most likely continue to involve increased costs, including, but not limited to,

compliance costs associated with new or enhanced technology.

In addition to the foregoing laws affecting regulation of our industry,

Congress is considering various proposals to increase taxation relating to investments, which may adversely impact the volume of trading

and other transactions from which we derive our revenue.

is not possible to determine the extent of the impact of any new laws, regulations or initiatives that may be imposed, or whether any

existing proposals will become law.

Conformance with any new laws or regulations could make compliance more difficult and expensive and

affect the manner in which we conduct business.

are subject to extensive government regulation and to third party litigation risk and regulatory risk which could result in significant

liabilities and reputational harm which, in turn, could materially adversely affect our business, results of operations and financial

business is subject to extensive regulation in the U.S., at both the federal and state level.

We are also subject to regulation by SROs

and other regulatory bodies in the U.S., such as the SEC, the NYSE, FINRA, MSRB, the CFTC and the NFA.

MSCO is registered as a broker-dealer

in 50 states, the District of Columbia, and Puerto Rico, and RISE is registered as a broker-dealer in 7 states and territories.

The regulations

to which MSCO and RISE are subject as broker-dealers cover all aspects of the securities business including training of personnel, sales

methods, trading practices, uses and safe keeping of customers’ funds and securities, capital structure, record keeping, fee arrangements,

disclosure and the conduct of directors, officers and employees.

SNXT is registered as an investment

adviser with the SEC under the Advisers Act, and its business is highly regulated.

The Advisers Act imposes numerous obligations on RIAs,

including fiduciary, record keeping, operational and disclosure obligations.

Moreover, the Advisers Act grants broad administrative powers

to regulatory agencies such as the SEC to regulate investment advisory businesses.

If the SEC or other government agencies believe that

SNXT has failed to comply with applicable laws or regulations, these agencies have the power to impose fines, suspensions of a registrant

and individual employees or other sanctions, which could include revocation of SNXT’s registration under the Advisers Act.

is also subject to the provisions and regulations of ERISA, to the extent that SNXT acts as a “fiduciary” under ERISA with

respect to certain of its clients.

ERISA and the applicable provisions of the federal tax laws impose a number of duties on persons who

are fiduciaries under ERISA and prohibit certain transactions involving the assets of each ERISA plan which is a client, as well as certain

transactions by the fiduciaries (and certain other related parties) to such plans.

Our subsidiaries, RISE and MSCO, are also regulated

by the NFA and function as a registered introducing broker.

The laws, rules and regulations,

as well as governmental policies and accounting principles, governing our business and the financial services and banking industries generally

have changed significantly over recent years and are expected to continue to do so.

We cannot predict which changes in laws, rules, regulations,

governmental policies or accounting principles will be adopted.

Any changes in the laws, rules, regulations, governmental policies or

accounting principles relating to our business could materially and adversely affect our business, results of operations and financial

is registered as an investment adviser with the SEC under the Advisers Act, and its business is highly regulated.

The Advisers Act imposes

numerous obligations on RIAs, including fiduciary, record keeping, operational and disclosure obligations.

Moreover, the Advisers Act

grants broad administrative powers to regulatory agencies such as the SEC to regulate investment advisory businesses.

If the SEC or other

government agencies believe that SNXT has failed to comply with applicable laws or regulations, these agencies have the power to impose

fines, suspensions of a registrant and individual employees or other sanctions, which could include revocation of SNXT’s registration

under the Advisers Act.

SNXT is also subject to the provisions and regulations of ERISA, to the extent that SNXT acts as a “fiduciary”

under ERISA with respect to certain of its clients.

ERISA and the applicable provisions of the federal tax laws impose a number of duties

on persons who are fiduciaries under ERISA and prohibit certain transactions involving the assets of each ERISA plan which is a client,

as well as certain transactions by the fiduciaries (and certain other related parties) to such plans.

Our subsidiaries, RISE and MSCO,

are also regulated by the NFA and function as a registered introducing broker.

laws, rules and regulations, as well as governmental policies and accounting principles, governing our business and the financial services

and banking industries generally have changed significantly over recent years and are expected to continue to do so.

We cannot predict

which changes in laws, rules, regulations, governmental policies or accounting principles will be adopted.

Any changes in the laws, rules,

regulations, governmental policies or accounting principles relating to our business could materially and adversely affect our business,

results of operations and financial condition.

Additionally,

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Refer to Item 3 – Legal Proceedings for additional detail.

We are subject to net capital requirements.

The SEC, FINRA, and various

other securities and commodities exchanges and other regulatory bodies in the U.S.

have rules with respect to net capital requirements

which affect us.

These rules have the effect of requiring that at least a substantial portion of a broker-dealer’s assets be kept

in cash or highly liquid investments.

Our compliance with the net capital requirements could limit operations that require intensive use

of capital, such as underwriting or trading activities.

These rules could also restrict our ability to withdraw our capital, even in circumstances

where we have more than the minimum amount of required capital, which, in turn, could limit our ability to implement growth strategies.

In addition, a change in such rules, or the imposition of new rules, affecting the scope, coverage, calculation or amount of such net

capital requirements, or a significant operating loss or any unusually large charge against net capital, could have similar adverse effects.

Risks Related to Our Technology and Information

We rely on information processing and communications

systems to process and record our transactions.

Our operations rely heavily

on information processing and communications systems.

Our system for processing securities transactions is highly automated.

our information processing or communications systems for a significant period of time could limit our ability to process a large volume

of transactions accurately and rapidly.

This could cause us to be unable to satisfy our obligations to customers and other securities

firms and could result in regulatory violations.

External events, such as an earthquake, terrorist attack or power failure, loss of external

information feeds, such as security price information, as well as internal malfunctions such as those that could occur during the implementation

of system modifications, could render part or all of these systems inoperative.

We rely on third-party platforms for information

and communications systems.

We rely heavily on our data

technology platforms and the platforms provided by our clearing agents.

These platforms offer interfaces to our clearing service providers’

computing systems where customer account records are kept and are accessible through our data technology platforms.

Our systems also utilize

browser-based access and other types of data communications.

Our data technology platforms

offer services used in direct relation to customer activities as well as support for corporate use.

Some of these services include email

and messaging, market data systems and third-party trading systems, business productivity tools and customer relationship management systems.

are subject to net capital requirements.

SEC, FINRA, and various other securities and commodities exchanges and other regulatory bodies in the U.S.

have rules with respect to

net capital requirements which affect us.

These rules have the effect of requiring that at least a substantial portion of a broker-dealer’s

assets be kept in cash or highly liquid investments.

Our compliance with the net capital requirements could limit operations that require

intensive use of capital, such as underwriting or trading activities.

These rules could also restrict our ability to withdraw our capital,

even in circumstances where we have more than the minimum amount of required capital, which, in turn, could limit our ability to implement

growth strategies.

In addition, a change in such rules, or the imposition of new rules, affecting the scope, coverage, calculation or

amount of such net capital requirements, or a significant operating loss or any unusually large charge against net capital, could have

similar adverse effects.

Related to Our Technology and Information Systems

rely on information processing and communications systems to process and record our transactions.

operations rely heavily on information processing and communications systems.

Our system for processing securities transactions is highly

Failure of our information processing or communications systems for a significant period of time could limit our ability to

process a large volume of transactions accurately and rapidly.

This could cause us to be unable to satisfy our obligations to customers

and other securities firms and could result in regulatory violations.

External events, such as an earthquake, terrorist attack or power

failure, loss of external information feeds, such as security price information, as well as internal malfunctions such as those that

could occur during the implementation of system modifications, could render part or all of these systems inoperative.

rely on third-party platforms for information and communications systems.

rely heavily on our data technology platforms and the platforms provided by our clearing agents.

These platforms offer interfaces to

our clearing service providers’ computing systems where customer account records are kept and are accessible through our data technology

Our systems also utilize browser-based access and other types of data communications.

data technology platforms offer services used in direct relation to customer activities as well as support for corporate use.

these services include email and messaging, market data systems and third-party trading systems, business productivity tools and customer

relationship management systems.

Our data network is designed with redundancies in case a significant business disruption occurs.

We also rely on third parties

that provide data center facilities, infrastructure, back-office systems for clearance, settlement and accounting, customer relationship

management, compliance and risk software and systems, website functionality and access, databases, data center facilities and cloud computing,

all of which are critical to our operations.

To ensure reliability and to conform to regulatory requirements related to business continuity,

we maintain backup systems and backup data, leverage cloud-based technology, and have a full-time offsite disaster recovery site to ensure

business continuity during a potential wide-spread disruption.

However, despite the preventive and protective measures in place, in the

event of a wide-spread disruption of our systems or those of the third-parties upon whom we rely, our ability to satisfy the obligations

to customers and other securities firms may be significantly hampered or completely disrupted.

Failure to protect client data or prevent

breaches of our information systems could expose us to liability or reputational damage.

We are dependent on information

technology networks and systems to securely process, transmit and store electronic information and to communicate among our branch offices

and with our clients and vendors.

As the breadth and complexity of this infrastructure continues to grow, the potential risk of security

breaches and cyber-attacks increases.

As a financial services company, we are continuously subject to cyber-attacks by third parties.

Any such security breach could lead to shutdowns or disruptions of our systems and potential unauthorized disclosure of confidential information.

In addition, vulnerabilities of our external service providers and other third parties could pose security risks to client information.

The secure transmission of confidential information over public networks is also a critical element of our operations.

In providing services to clients,

we manage, utilize and store sensitive and confidential client data, including personal data.

As a result, we are subject to numerous

laws and regulations designed to protect this information, such as U.S.

federal and state laws governing the protection of personally

identifiable information.

These laws and regulations are increasing in complexity and number, changing frequently and sometimes conflict.

If any person, including any of our employees, negligently disregards or intentionally breaches our established controls with respect

to client data, or otherwise mismanages or misappropriates that data, we could be subject to significant monetary damages, regulatory

enforcement actions, fines and/or criminal prosecution in one or more jurisdictions.

Unauthorized disclosure of sensitive or confidential

client data, whether through systems failure, employee negligence, fraud or misappropriation, could damage our reputation and cause us

to lose clients.

Similarly, unauthorized access to or through our information systems, whether by our employees or third parties, including

a cyber-attack by third parties who may deploy viruses, worms or other malicious software programs, could result in negative publicity,

significant remediation costs, legal liability, and damage to our reputation and could have a material adverse effect on our results of

We have purchased liability

insurance and cybersecurity insurance with a coverage limit of $15 million and a deductible of $250,000 to mitigate the financial impact

of potential cyber-attacks.

However, our insurance may not be sufficient in type or amount to fully cover claims arising from security

breaches, cyber-attacks, and other related incidents.

We may be exposed to damage to our business

or our reputation by cybersecurity breaches.

As the world becomes more

interconnected through the use of the internet and users rely more extensively on the internet and the cloud for the transmission and

storage of data, such information becomes more susceptible to incursion by hackers and other parties intent on stealing or destroying

data on which we or our customers rely.

We face an evolving landscape of cybersecurity threats in which hackers use a complex array of

means to perpetrate cyber-attacks, including the use of stolen access credentials, malware, ransomware, phishing, structured query language

injection attacks, and distributed denial-of-service attacks, among other means.

These cybersecurity incidents have increased in number

and severity, and it is expected that these trends will continue.

also rely on third parties that provide data center facilities, infrastructure, back-office systems for clearance, settlement and accounting,

customer relationship management, compliance and risk software and systems, website functionality and access, databases, data center

facilities and cloud computing, all of which are critical to our operations.

To ensure reliability and to conform to regulatory requirements

related to business continuity, we maintain backup systems and backup data, leverage cloud-based technology, and have a full-time offsite

disaster recovery site to ensure business continuity during a potential wide-spread disruption.

However, despite the preventive and protective

measures in place, in the event of a wide-spread disruption of our systems or those of the third-parties upon whom we rely, our ability

to satisfy the obligations to customers and other securities firms may be significantly hampered or completely disrupted.

to protect client data or prevent breaches of our information systems could expose us to liability or reputational damage.

are dependent on information technology networks and systems to securely process, transmit and store electronic information and to communicate

among our branch offices and with our clients and vendors.

As the breadth and complexity of this infrastructure continues to grow, the

potential risk of security breaches and cyber-attacks increases.

As a financial services company, we are continuously subject to cyber-attacks

by third parties.

Any such security breach could lead to shutdowns or disruptions of our systems and potential unauthorized disclosure

of confidential information.

In addition, vulnerabilities of our external service providers and other third parties could pose security

risks to client information.

The secure transmission of confidential information over public networks is also a critical element of our

providing services to clients, we manage, utilize and store sensitive and confidential client data, including personal data.

we are subject to numerous laws and regulations designed to protect this information, such as U.S.

federal and state laws governing the

protection of personally identifiable information.

These laws and regulations are increasing in complexity and number, changing frequently

and sometimes conflict.

If any person, including any of our employees, negligently disregards or intentionally breaches our established

controls with respect to client data, or otherwise mismanages or misappropriates that data, we could be subject to significant monetary

damages, regulatory enforcement actions, fines and/or criminal prosecution in one or more jurisdictions.

Unauthorized disclosure of sensitive

or confidential client data, whether through systems failure, employee negligence, fraud or misappropriation, could damage our reputation

and cause us to lose clients.

Similarly, unauthorized access to or through our information systems, whether by our employees or third

parties, including a cyber-attack by third parties who may deploy viruses, worms or other malicious software programs, could result in

negative publicity, significant remediation costs, legal liability, and damage to our reputation and could have a material adverse effect

on our results of operations.

have purchased liability insurance and cybersecurity insurance with a coverage limit of $15 million and a deductible of $250,000 to mitigate

the financial impact of potential cyber-attacks.

However, our insurance may not be sufficient in type or amount to fully cover claims

arising from security breaches, cyber-attacks, and other related incidents.

may be exposed to damage to our business or our reputation by cybersecurity breaches.

the world becomes more interconnected through the use of the internet and users rely more extensively on the internet and the cloud for

the transmission and storage of data, such information becomes more susceptible to incursion by hackers and other parties intent on stealing

or destroying data on which we or our customers rely.

We face an evolving landscape of cybersecurity threats in which hackers use a complex

array of means to perpetrate cyber-attacks, including the use of stolen access credentials, malware, ransomware, phishing, structured

query language injection attacks, and distributed denial-of-service attacks, among other means.

These cybersecurity incidents have increased

in number and severity, and it is expected that these trends will continue.

Should we be affected by such an incident, we may incur substantial

costs and suffer other negative consequences, which may include:

● Remediation costs, such as liability for stolen assets or

information, repairs of system damage, and incentives to customers or business partners in an effort to maintain relationships after

● Increased cybersecurity protection costs, which may include

the costs of making organizational changes, deploying additional personnel and protection technologies, training employees, and engaging

● Remediation

costs, such as liability for stolen assets or information, repairs of system damage, and

incentives to customers or business partners in an effort to maintain relationships after

cybersecurity protection costs, which may include the costs of making organizational changes,

deploying additional personnel and protection technologies, training employees, and engaging

third party experts and consultants;

● Lost revenues resulting from the unauthorized use of proprietary

information or the failure to retain or attract customers following an attack;

● Litigation and legal risks, including regulatory actions by

state and federal regulators;

● Loss of reputation.

Increasingly, intruders attempt

to steal significant amounts of data, including personally identifiable data and either hold such data for ransom or release it onto the

internet, exposing our clients to financial or other harm and thereby significantly increasing our liability in such cases.

Our regulators

have introduced programs to review our protections against such incidents which, if they determined that our systems do not reasonably

protect our clients’ assets and their data, could result in enforcement activity and sanctions.

We have and continue to introduce

systems and software to prevent any such incidents and review and increase our defenses to such issues through the use of various services,

programs and outside vendors.

We contract cybersecurity consultants and also review and revise our cybersecurity policy to ensure that

it remains up to date.

It is impossible, however, for us to know when or if such incidents may arise or the business impact of any such

As a result of such risks,

we have and are likely to incur significant costs in preparing our infrastructure and maintaining it to resist any such attacks.

An increase in volume on our systems or

other events could cause them to malfunction.

Most of our trade orders are

received and processed electronically.

This method of trading is heavily dependent on the integrity of the electronic systems supporting

While we have never experienced a significant failure of our trading systems, heavy stress placed on our systems during peak trading

times could cause our systems to operate at unacceptably low speeds or fail altogether.

Any significant degradation or failure of our

systems or the systems of third parties involved in the trading process (e.g., online and internet service providers, record keeping and

data processing functions performed by third parties, and third party software), even for a short time, could cause customers to suffer

delays in trading.

These delays could cause substantial losses for customers and could subject us to claims from these customers for losses.

There can be no assurance that our network structure will operate appropriately in the event of a subsystem, component or software failure.

In addition, we cannot assure that we will be able to prevent an extended systems failure in the event of a power or telecommunications

failure, an earthquake, terrorist attack, fire or any act of God.

Any systems failure that causes interruptions in our operations could

have a material adverse effect on our business, financial condition and operating results.

Rapid market or technological changes may

render our technology obsolete or decrease the attractiveness of our products and services to our clients.

We must continue to enhance

and improve our technology and electronic services and expect to increase investments in our own technology.

The electronic financial

services industry is characterized by significant structural changes, increasingly complex systems and infrastructures, changes in clients’

needs and preferences, and new business models.

If new industry standards and practices emerge and our competitors release new technology

before us, our existing technology, systems and electronic trading services may become obsolete, or our existing business may be harmed.

Our future success will depend

on our ability to:

● Enhance our existing products and services;

● Develop and/or license new products and technologies that

address the increasingly sophisticated and varied needs of our clients and prospective clients;

● Continue to attract highly-skilled technology personnel;

● Respond to technological advances and emerging industry standards

and practices on a cost-effective and timely basis.

Developing our electronic

services, our implementation and utilization of our robo-advisor and other technology entails significant technical and business risks.

We may use new technologies ineffectively or we may fail to adapt our electronic trading platform, information databases and network infrastructure

to client requirements or emerging industry standards.

If we face material delays in introducing new services, products and enhancements,

our clients may forgo the use of our products and use those of our competitors.

revenues resulting from the unauthorized use of proprietary information or the failure to

retain or attract customers following an attack;

and legal risks, including regulatory actions by state and federal regulators;

of reputation.

Increasingly,

intruders attempt to steal significant amounts of data, including personally identifiable data and either hold such data for ransom or

release it onto the internet, exposing our clients to financial or other harm and thereby significantly increasing our liability in such

Our regulators have introduced programs to review our protections against such incidents which, if they determined that our systems

do not reasonably protect our clients’ assets and their data, could result in enforcement activity and sanctions.

have and continue to introduce systems and software to prevent any such incidents and review and increase our defenses to such issues

through the use of various services, programs and outside vendors.

We contract cybersecurity consultants and also review and revise our

cybersecurity policy to ensure that it remains up to date.

It is impossible, however, for us to know when or if such incidents may arise

or the business impact of any such incident.

a result of such risks, we have and are likely to incur significant costs in preparing our infrastructure and maintaining it to resist

any such attacks.

increase in volume on our systems or other events could cause them to malfunction.

of our trade orders are received and processed electronically.

This method of trading is heavily dependent on the integrity of the electronic

systems supporting it.

While we have never experienced a significant failure of our trading systems, heavy stress placed on our systems

during peak trading times could cause our systems to operate at unacceptably low speeds or fail altogether.

Any significant degradation

or failure of our systems or the systems of third parties involved in the trading process (e.g., online and internet service providers,

record keeping and data processing functions performed by third parties, and third party software), even for a short time, could cause

customers to suffer delays in trading.

These delays could cause substantial losses for customers and could subject us to claims from

these customers for losses.

There can be no assurance that our network structure will operate appropriately in the event of a subsystem,

component or software failure.

In addition, we cannot assure that we will be able to prevent an extended systems failure in the event

of a power or telecommunications failure, an earthquake, terrorist attack, fire or any act of God.

Any systems failure that causes interruptions

in our operations could have a material adverse effect on our business, financial condition and operating results.

market or technological changes may render our technology obsolete or decrease the attractiveness of our products and services to our

must continue to enhance and improve our technology and electronic services and expect to increase investments in our own technology.

The electronic financial services industry is characterized by significant structural changes, increasingly complex systems and infrastructures,

changes in clients’ needs and preferences, and new business models.

If new industry standards and practices emerge and our competitors

release new technology before us, our existing technology, systems and electronic trading services may become obsolete, or our existing

business may be harmed.

future success will depend on our ability to:

our existing products and services;

and/or license new products and technologies that address the increasingly sophisticated

and varied needs of our clients and prospective clients;

to attract highly-skilled technology personnel;

to technological advances and emerging industry standards and practices on a cost-effective

and timely basis.

our electronic services, our implementation and utilization of our robo-advisor and other technology entails significant technical and

business risks.

We may use new technologies ineffectively or we may fail to adapt our electronic trading platform, information databases

and network infrastructure to client requirements or emerging industry standards.

If we face material delays in introducing new services,

products and enhancements, our clients may forgo the use of our products and use those of our competitors.

the adoption of new internet, networking or telecommunications technologies may require us to devote substantial resources to modify

4 unchanged sentences

in a timely manner to changing market conditions or client requirements.

Risks Related to Our Business Operations

We previously identified material weaknesses

in our internal control over financial reporting and if we fail to maintain an effective system of internal control in the future, this

could result in loss of investor confidence and adversely impact our stock price.

We reported in our Annual

Report on Form 10-K for the fiscal year ended December 31, 2023, a material weakness because we did not design and maintain effective

controls over certain information technology (“IT”) or general computer controls for information systems that are relevant

to the preparation of the consolidated financial statements.

Specifically, we did not design and maintain user access controls to ensure

appropriate segregation of duties and adequate restricted user and privileged access to financial applications, data and programs to the

appropriate personnel.

During 2024, we also identified material weaknesses relating to (1) our failure to design adequate internal controls

surrounding security market values within our back-office stock record system, including the accuracy and completeness of pricing of firm

and customers’ fully paid and excess margin securities, and (2) our internal controls surrounding the quarterly securities count

lacking sufficient documented review and precision of review to demonstrate the completeness and accuracy of the count performed in accordance

with Rule 17a-13 of the Exchange Act.

As of December 31, 2024, we completed the remediation measures related to the material weaknesses

and concluded that our internal control over financial reporting was effective as of December 31, 2024.

Completion of remediation does

not provide assurance that our remediation or other controls will continue to operate properly.

If we are unable to maintain effective

internal control over financial reporting or disclosure controls and procedures, our ability to record, process and report financial information

accurately, and to prepare financial statements within required time periods could be adversely affected, which could subject us to litigation

or investigations requiring management resources and payment of legal and other expenses, negatively affect investor confidence in our

financial statements and adversely impact our stock price.

Potential strategic acquisitions and other

business growth could increase costs and regulatory and integration risks.

Acquisitions involve risks

that could adversely affect our business.

Related to Our Business Operations

strategic acquisitions and other business growth could increase costs and regulatory and integration risks.

involve risks that could adversely affect our business.

We may pursue acquisitions of businesses and technologies.

Acquisitions and other transactions

entail numerous risks, including:

● Difficulties in the integration of acquired operations, services

and products;

● Failure to achieve expected synergies;

● Diversion of management’s attention from other business

● Assumption of unknown material liabilities of acquired companies;

● Amortization of acquired intangible assets, which could reduce

future reported earnings;

● Potential loss of clients or key employees of acquired companies;

● Dilution to existing stockholders.

As part of our growth strategy,

we regularly consider and from time to time engage in discussions and negotiations regarding transactions such as acquisitions, mergers,

combinations and partnerships within our industry.

The purchase price for possible acquisitions could be paid in cash, through the issuance

of our common stock or other securities, borrowings or a combination of these methods.

Acquisitions and other

transactions entail numerous risks, including:

● Difficulties

in the integration of acquired operations, services and products;

to achieve expected synergies;

of management’s attention from other business concerns;

of unknown material liabilities of acquired companies;

● Amortization

of acquired intangible assets, which could reduce future reported earnings;

loss of clients or key employees of acquired companies;

to existing stockholders.

part of our growth strategy, we regularly consider and from time to time engage in discussions and negotiations regarding transactions

such as acquisitions, mergers, combinations and partnerships within our industry.

The purchase price for possible acquisitions could

be paid in cash, through the issuance of our common stock or other securities, borrowings or a combination of these methods.

transactions are typically subject to closing conditions including regulatory approvals and the absence of material adverse changes in

3 unchanged sentences

If a material transaction does not close our stock price could decline.

We cannot be certain that

we will be able to identify, consummate and successfully integrate acquisitions, and no assurance can be given with respect to the timing,

likelihood or business effect of any possible transaction.

For example, we could begin negotiations that we subsequently decide to suspend

or terminate for a variety of reasons.

However, opportunities may arise that we will evaluate and any transactions that we consummate

would involve risks and uncertainties to us.

These risks could cause the failure of any anticipated benefits of an acquisition to be realized,

which could have a material adverse effect on our business, financial condition, results of operations and prospects.

We depend on our ability to attract and

retain key personnel.

We are dependent upon our

key personnel for our success and the loss of the services of any of these individuals could significantly harm our business, financial

condition and operating results.

We do not own the Muriel Siebert and Siebert

names, but we may use them as part of our corporate name pursuant to a license agreement.

Use of the names by other parties or the expiration

or termination of our license agreement may harm our business.

We have entered into a license

agreement with the Muriel Siebert Estate / Foundation under which we have a license to use the “Muriel Siebert” and “Siebert”

name until 2026.

In the event that the license agreement is terminated, or if the license agreement is not renewed or extended beyond

2026, we may be required to change our name and cease using the name.

Any of these events could disrupt our recognition in the marketplace

and otherwise harm our business.

Our customers may fail to pay us.

A principal credit risk to

which we are exposed on a regular basis is that our customers may fail to pay for their purchases or fail to maintain the minimum required

collateral for amounts borrowed against securities positions maintained by them.

We cannot assure that our practices and/or the policies

and procedures we have established will be adequate to prevent a significant credit loss.

Our advisory services subject us to additional

We provide investment advisory

services to investors.

cannot be certain that we will be able to identify, consummate and successfully integrate acquisitions, and no assurance can be given

with respect to the timing, likelihood or business effect of any possible transaction.

For example, we could begin negotiations that

we subsequently decide to suspend or terminate for a variety of reasons.

However, opportunities may arise that we will evaluate and any

transactions that we consummate would involve risks and uncertainties to us.

These risks could cause the failure of any anticipated benefits

of an acquisition to be realized, which could have a material adverse effect on our business, financial condition, results of operations

and prospects.

depend on our ability to attract and retain key personnel.

are dependent upon our key personnel for our success and the loss of the services of any of these individuals could significantly harm

our business, financial condition and operating results.

do not own the Muriel Siebert and Siebert names, but we may use them as part of our corporate name pursuant to a license agreement.

of the names by other parties or the expiration or termination of our license agreement may harm our business.

have entered into a license agreement with the Muriel Siebert Estate / Foundation under which we have a license to use the “Muriel

Siebert” and “Siebert” name until December 2026.

In the event that the license agreement is terminated, or if the license

agreement is not renewed or extended beyond 2026, we may be required to change our name and cease using the name.

Any of these events

could disrupt our recognition in the marketplace and otherwise harm our business.

customers may fail to pay us.

principal credit risk to which we are exposed on a regular basis is that our customers may fail to pay for their purchases or fail to

maintain the minimum required collateral for amounts borrowed against securities positions maintained by them.

We cannot assure that

our practices and/or the policies and procedures we have established will be adequate to prevent a significant credit loss.

advisory services subject us to additional risks.

provide investment advisory services to investors.

Through our RIA, SNXT, we offer robo-advisory and investment services.

The risks associated with these investment

advisory activities include those arising from possible conflicts of interest, unsuitable investment recommendations, inadequate due diligence,

inadequate disclosure and fraud.

Realization of these risks could lead to liability for client losses, regulatory fines, civil penalties

and harm to our reputation and business.

Certain employees, directors and affiliates

of RISE and Siebert own equity in RISE Financial Services, LLC

During the first quarter of

2022, RISE issued, and Siebert sold membership interests in RISE to certain employees, directors, and affiliates of RISE and Siebert ranging

from 1% to 2% individually.

This amount represented, as of the date of this Report, an aggregate of 7% of the total issued and outstanding

membership interests in RISE.

As of the date of this Report, Gloria E.

Gebbia owns approximately 24% of RISE.

As a result, the interests

of the employees, directors, and affiliates of RISE and Siebert who own equity in RISE may differ from the interests of shareholders of

Risks Related to Our Common Stock

There may be a limited public market for

our common stock;

13,908,556 shares of our common

stock, or approximately 34.4% of our shares of our common stock outstanding, are currently held by non-affiliates as of March 5, 2025.

A stock with a small number of shares held by non-affiliates, known as the “float,” will generally be more volatile than a

stock with a large float.

Although our common stock is traded on the Nasdaq Capital Market, there can be no assurance that an active public

market will continue.

Our principal shareholder has significant

influence over us.

Gebbia, who is a

director of Siebert, the managing member of Kennedy Cabot Acquisition, LLC (“KCA”) and the spouse of Siebert’s Chief

Executive Officer, has, along with other family members, the power to nominate six directors to the Board of Directors and owns approximately

42% of our common stock as of December 31, 2024.

As a result, they have significant influence on matters submitted to a vote of shareholders.

Future sales of our common stock in the

public market could cause the market price of our common stock to drop significantly, even if our business is doing well.

Sales of a substantial number

of shares of our common stock in the public market by new issuances or through sales by existing shareholders, or the perception in the

market that we or the holders of a large number of shares intend to sell shares, could reduce the market price of our common stock and

make it more difficult for investors to sell common stock at a time and price that investors deem appropriate.

On April 27, 2023, Siebert

entered into a Stock Purchase Agreement (the “First Tranche Stock Purchase Agreement”) with Kakaopay Corporation (“Kakaopay”),

a company established under the Laws of the Republic of Korea, pursuant to which Siebert issued to Kakaopay 8,075,607 shares of Siebert’s

common stock, which represented at the time of issuance 19.9% of the outstanding equity securities of Siebert on a fully diluted basis.

The risks associated

with these investment advisory activities include those arising from possible conflicts of interest, unsuitable investment recommendations,

inadequate due diligence, inadequate disclosure and fraud.

Realization of these risks could lead to liability for client losses, regulatory

fines, civil penalties and harm to our reputation and business.

lines of business or new products and services may subject us to additional risks.

We may pursue new lines of

business or offer new products and services within existing lines of business, such as Investment banking, GM or Siebert Crypto.

time and resources may be invested in developing and marketing new lines of business and/or new products and services.

Initial timetables

for the development and introduction of new lines of business and/or new products or services may not be achieved and price and profitability

targets may not prove feasible.

Furthermore, customers may fail to accept the new products and services.

External factors, such as compliance

with regulations, competitive alternatives, and shifting market preferences may also impact the successful implementation of a new line

of business or a new product or service.

Furthermore, the burden on management and information technology of introducing any new line

of business and/or new product or service could have a significant impact on the effectiveness of our system of internal controls.

to successfully manage these risks and costs in the development and implementation of new lines of business or new products or services

could have a material adverse effect on our business, financial condition, and results of operations.

Related to Our Common Stock

may be a limited public market for our common stock;

14,441,440 shares of our common stock, or approximately 35.3% of our

shares of our common stock outstanding, are currently held by non-affiliates as of March 24, 2026.

A stock with a small number of shares

held by non-affiliates, known as the “float,” will generally be more volatile than a stock with a large float.

common stock is traded on the Nasdaq Capital Market, there can be no assurance that an active public market will continue.

principal shareholder has significant influence over us.

Gebbia, who is a director of Siebert, the managing member of Kennedy Cabot Acquisition, LLC (“KCA”) and the spouse of

Siebert’s Chief Executive Officer, has, along with other family members, the power to nominate six directors to the Board of Directors

and owns approximately 42% of our common stock as of December 31, 2025.

As a result, they have significant influence on matters submitted

to a vote of shareholders.

sales of our common stock in the public market could cause the market price of our common stock to drop significantly, even if our business

is doing well.

of a substantial number of shares of our common stock in the public market by new issuances or through sales by existing shareholders,

or the perception in the market that we or the holders of a large number of shares intend to sell shares, could reduce the market price

of our common stock and make it more difficult for investors to sell common stock at a time and price that investors deem appropriate.

April 27, 2023, Siebert entered into a Stock Purchase Agreement (the “First Tranche Stock Purchase Agreement”) with Kakaopay

Corporation (“Kakaopay”), a company established under the Laws of the Republic of Korea, pursuant to which Siebert issued

to Kakaopay 8,075,607 shares of Siebert’s common stock, currently represents 20% of the outstanding equity securities of Siebert.

The First Tranche closed on May 18, 2023 and, in connection therewith, we entered into a Registration Rights and Lock-Up Agreement, dated

2 unchanged sentences

and the Settlement Agreement (as defined below), we filed a registration statement with the SEC registering these shares for resale.

number of shares of common stock could be significant in relation to our currently outstanding common stock and the historical trading

The number of shares of common stock could be significant in relation to our currently outstanding common stock and the historical trading

volume of our common stock.

The sale by Kakaopay of all or a significant portion of the shares of common stock could have a material adverse

effect on the market price of our common stock.

In addition, the perception in the public markets that Kakaopay might sell all or a portion

of the shares of common stock could also, in and of itself, have a material adverse effect on the market price of our common stock.

The price of our common stock in the public

markets has experienced, and may in the future experience, extreme volatility due to a variety of factors, many of which are beyond our

Since our common stock started

trading on the Nasdaq Capital Market, our common stock has been relatively thinly traded and at times been subject to price volatility.

The sale by Kakaopay of all or a significant portion of the shares of common stock could have a material

adverse effect on the market price of our common stock.

In addition, the perception in the public markets that Kakaopay might sell all

or a portion of the shares of common stock could also, in and of itself, have a material adverse effect on the market price of our common

price of our common stock in the public markets has experienced, and may in the future experience, extreme volatility due to a variety

of factors, many of which are beyond our control.

our common stock started trading on the Nasdaq Capital Market, our common stock has been relatively thinly traded and at times been subject

to price volatility.

The average daily trading volume from January 1, 2025 to December 31, 2025 was approximately 64,709 shares.

We believe that the trading

price of our common stock has at times been influenced by trading factors other than industry or Company-specific fundamentals, including,

without limitation, the sentiment of retail investors (including as may be expressed on financial trading and other social media sites),

speculation in the press, in the investment community, or on the internet, including on online forums and social media, about Siebert,

our industry or our security’s access to margin debt, trading in options and other derivatives on our common stock, and the amount

and status of short interest in our securities (including a “short squeeze”).

A “short squeeze” is a technical

market condition that occurs when the price of a stock increases substantially, forcing market participants who had taken a position that

its price would fall (i.e., who had sold the stock “short”), to buy it, which in turn may create significant, short-term demand

for the stock not for fundamental reasons, but rather due to the need for such market participants to acquire the stock in order to forestall

the risk of even greater losses.

A “short squeeze” condition in the market for a stock can lead to short-term conditions involving

very high volatility and trading that may or may not track fundamental valuation models.

As a result of the foregoing,

investors in our common stock may be subject to the risk of significant, short-term price volatility of our common stock and the trading

price of our common stock could decline for reasons unrelated to our business, financial condition, or results of operations.

in the past, following periods of volatility in the overall market and the market price of a particular company’s securities, securities

class action litigation has often been instituted against these companies.

If any of the foregoing occurs, it could cause our stock price

to fall and may expose us to lawsuits that, even if unsuccessful, could be costly to defend and a distraction to management.

Our future ability to pay dividends to holders

of our common stock is subject to the discretion of our Board of Directors and will be limited by our ability to generate sufficient earnings

and cash flows.

We did not pay any dividends

in 2024 or 2023.

Payment of future cash dividends on our common stock will depend on our ability to generate earnings and cash flows.

believe that the trading price of our common stock has at times been influenced by trading factors other than industry or Company-specific

fundamentals, including, without limitation, the sentiment of retail investors (including as may be expressed on financial trading and

other social media sites), speculation in the press, in the investment community, or on the internet, including on online forums and

social media, about Siebert, our industry or our security’s access to margin debt, trading in options and other derivatives on

our common stock, and the amount and status of short interest in our securities (including a “short squeeze”).

squeeze” is a technical market condition that occurs when the price of a stock increases substantially, forcing market participants

who had taken a position that its price would fall (i.e., who had sold the stock “short”), to buy it, which in turn may create

significant, short-term demand for the stock not for fundamental reasons, but rather due to the need for such market participants to

acquire the stock in order to forestall the risk of even greater losses.

A “short squeeze” condition in the market for a

stock can lead to short-term conditions involving very high volatility and trading that may or may not track fundamental valuation models.

a result of the foregoing, investors in our common stock may be subject to the risk of significant, short-term price volatility of our

common stock and the trading price of our common stock could decline for reasons unrelated to our business, financial condition, or results

of operations.

Further, in the past, following periods of volatility in the overall market and the market price of a particular company’s

securities, securities class action litigation has often been instituted against these companies.

If any of the foregoing occurs, it

could cause our stock price to fall and may expose us to lawsuits that, even if unsuccessful, could be costly to defend and a distraction

to management.

future ability to pay dividends to holders of our common stock is subject to the discretion of our Board of Directors and will be limited

by our ability to generate sufficient earnings and cash flows.

did not pay any dividends in 2025 or 2024.

Payment of future cash dividends on our common stock will depend on our ability to generate

earnings and cash flows.

However, sufficient cash may not be available to pay such dividends.

Payment of future dividends, if any, will be at the discretion of

our Board of Directors and will depend upon a number of factors that the Board of Directors deems relevant, including future earnings,

the success of our business activities, capital requirements, the general financial condition and future prospects of our business and

general business conditions.

If we are unable to generate sufficient earnings and cash flows from our business, we may not be able to

pay dividends on our common stock.

Our ability to pay cash dividends

on our common stock is also dependent on the ability of our subsidiaries to pay dividends or capital distributions to Siebert.

RISE are subject to various regulatory requirements relating to liquidity, capital standards and the use of client funds and securities,

which may limit funds available for payments to Siebert.

The ability of our subsidiaries to pay dividends or capital distributions to

Siebert may also be subject to regulatory approval.

Risks Related to Our Industry and Market

Securities market volatility and other securities

industry risk could adversely affect our business.

Most of our revenues are derived

from our securities brokerage business.

Like other businesses operating in the securities industry, our business is directly affected

by volatile trading markets, fluctuations in the volume of market activity, economic and political conditions, upward and downward trends

in business and finance at large, legislation and regulation affecting the national and international business and financial communities,

currency values, inflation, market conditions, the availability and cost of short-term or long-term funding and capital, the credit capacity

or perceived credit-worthiness of the securities industry in the marketplace and the level and volatility of interest rates.

risks relating to losses resulting from the ownership of securities, counterparty failure to meet commitments, customer fraud, employee

fraud, issuer fraud, errors and misconduct, failures in connection with the processing of securities transactions and litigation.

in our revenues or a loss resulting from our ownership of securities or sales or trading of securities could have a material adverse effect

on our business, results of operations and financial condition.

In addition, as a result of these risks, our revenues and operating results

may be subject to significant fluctuations from quarter to quarter and from year to year.

Interest rate changes could affect our

profitability.

Payment of future dividends, if any, will

be at the discretion of our Board of Directors and will depend upon a number of factors that the Board of Directors deems relevant, including

future earnings, the success of our business activities, capital requirements, the general financial condition and future prospects of

our business and general business conditions.

If we are unable to generate sufficient earnings and cash flows from our business, we may

not be able to pay dividends on our common stock.

ability to pay cash dividends on our common stock is also dependent on the ability of our subsidiaries to pay dividends or capital distributions

MSCO and RISE are subject to various regulatory requirements relating to liquidity, capital standards and the use of client

funds and securities, which may limit funds available for payments to Siebert.

The ability of our subsidiaries to pay dividends or capital

distributions to Siebert may also be subject to regulatory approval.

Related to Our Industry and Market

market volatility and other securities industry risk could adversely affect our business.

of our revenues are derived from our securities brokerage business.

Like other businesses operating in the securities industry, our business

is directly affected by volatile trading markets, fluctuations in the volume of market activity, economic and political conditions, upward

and downward trends in business and finance at large, legislation and regulation affecting the national and international business and

financial communities, currency values, inflation, market conditions, the availability and cost of short-term or long-term funding and

capital, the credit capacity or perceived credit-worthiness of the securities industry in the marketplace and the level and volatility

of interest rates.

We also face risks relating to losses resulting from the ownership of securities, counterparty failure to meet commitments,

customer fraud, employee fraud, issuer fraud, errors and misconduct, failures in connection with the processing of securities transactions

and litigation.

A reduction in our revenues or a loss resulting from our ownership of securities or sales or trading of securities could

have a material adverse effect on our business, results of operations and financial condition.

In addition, as a result of these risks,

our revenues and operating results may be subject to significant fluctuations from quarter to quarter and from year to year.

rate changes could affect our profitability.

direction and level of interest rates are important factors in our earnings.

Our earnings are affected by the difference between the interest

rates earned on interest-earning assets such as loans and investment securities and interest rates paid on interest-bearing liabilities

such as deposits and borrowings.

Decreases in interest rates negatively impact our revenue by reducing the margin and other interest income,

as well as distribution fees received from money market securities.

Lower rates can compress net interest margins, impacting the profitability

of our interest-earning assets and affecting overall revenue.

Our earnings are affected by the difference between the

interest rates earned on interest-earning assets such as loans and investment securities and interest rates paid on interest-bearing

liabilities such as deposits and borrowings.

Decreases in interest rates negatively impact our revenue by reducing the margin and other

interest income, as well as distribution fees received from money market securities.

Lower rates can compress net interest margins, impacting

the profitability of our interest-earning assets and affecting overall revenue.

economy navigates a period of stabilization, inflation remains elevated, and the Federal Reserve may raise, maintain or lower

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by reducing trading volumes, spreads, and demand for certain brokerage products.

A prolonged economic slowdown, volatility

in the markets, a recession, and uncertainty in the markets could impair our business and harm our operating results.

Our businesses are, and will

continue to be, susceptible to economic slowdowns, recessions and volatility in the markets, which may lead to financial losses for our

customers, and a decrease in revenues and operating results.

In addition, global macroeconomic conditions and U.S.

financial markets remain

vulnerable to the potential risks posed by exogenous shocks, which could include, among other things, political and financial uncertainty

and the European Union, renewed concern about China’s economy, geopolitical conflicts, complications involving terrorism

and armed conflicts around the world, or other challenges to global trade or travel.

More generally, because our business is closely correlated

to the macroeconomic outlook, a significant deterioration in that outlook or an exogenous shock would likely have an immediate negative

impact on our overall results of operations.

There is intense competition in the brokerage

We encounter significant competition

from full-commission, no commission, online and other discount brokerage firms, as well as from financial institutions, mutual fund sponsors,

venture-backed technology and cryptocurrency firms, and other organizations.

Over the past several years, price wars and lower or no commission

rates in the discount brokerage business in general have strengthened our competitors.

In addition, while the decline of commissions has

been ongoing for decades, some of our competitors charging zero commissions on trades could potentially have an adverse effect on our

commission revenue.

The securities brokerage industry

has experienced significant consolidation, which may continue in the future, likely increasing competitive pressures in the industry.

Consolidation could enable other firms to offer a broader range of products and services than we do, or offer them on better terms, such

as higher interest rates paid on cash held in client accounts.

We believe that such changes in the industry will continue to strengthen

existing competitors and attract additional competitors such as banks, insurance companies, providers of online financial and information

services, and others.

Many of these competitors are larger, more diversified, have greater capital resources, and offer a wider range

of services and financial products than we do.

We compete with a wide variety of vendors of financial services for the same customers.

Many of these competitors conduct extensive marketing campaigns and may have or achieve exceptional market name recognition.

be able to compete effectively with current or future competitors with stronger capital positions, greater name recognition or who partner

or combine with other larger firms.

Some competitors in the discount

brokerage business offer services which we may not offer.

In addition, some competitors have continued to offer flat rate execution fees

that are lower than some of our published rates.

Industry-wide changes in trading practices are expected to cause continuing pressure

on fees earned by discount brokers for the sale of order flow.

Continued or increased competition from ultra-low costs, flat-fee brokers

and broader service offerings from other discount brokers could limit our growth or lead to a decline in our customer base which would

adversely affect our business, results of operations and financial condition.

Further, if we are not able to update or adapt our products

and services to take advantage of the latest technologies and standards, or are otherwise unable to offer services to mobile and desktop

computing platforms to a growing self-directed investor market, it could have a material adverse effect on our ability to compete.

Lower price levels in the securities markets

may reduce our profitability.

Lower price levels of securities

may result in (i) reduced volumes of securities, options and futures transactions, with a consequent reduction in our commission revenues,

and (ii) losses from declines in the market value of securities we hold in investment.

In periods of low volume, our levels of profitability

are further adversely affected because certain of our expenses remain relatively fixed.

Sudden sharp declines in market values of securities

and the failure of issuers and counterparties to perform their obligations can result in illiquid markets which, in turn, may result in

us having difficulty selling securities.

Such negative market conditions, if prolonged, may lower our revenues.

A reduction in our revenues

could have a material adverse effect on our business, results of operations and financial condition.

The soundness of other financial institutions

and intermediaries affects us.

We face the risk of operational

failure, termination or capacity constraints of any of the clearing agents, exchanges, clearing houses or other financial intermediaries

that we use to facilitate our securities transactions.

As a result of the consolidation over the years of clearing agents, exchanges and

clearing houses, our exposure to certain financial intermediaries has increased and could affect our ability to find adequate and cost-effective

alternatives should the need arise.

Any failure, termination or constraint of these intermediaries could adversely affect our ability

to execute transactions, service our clients and manage our exposure to risk.

Our ability to engage in routine

trading and funding transactions could be adversely affected by the actions and commercial soundness of other financial institutions.

Financial services institutions are interrelated as a result of trading, clearing, funding, and counterparties or other relationships.

We have exposure to many different industries and counterparties, and we routinely execute transactions with counterparties in the financial

industry, including brokers and dealers, commercial banks, investment banks, mortgage originators and other institutional clients.

a result, defaults by, or even rumors or questions about the financial condition of, one or more financial services institutions, or the

financial services industry generally, have historically led to market-wide liquidity problems and could lead to losses or defaults by

us or by other institutions.

Many of these transactions expose us to credit risk in the event of default of our counterparty or client.

In addition, our credit risk may be exacerbated when the collateral held by us cannot be realized or is liquidated at prices insufficient

to recover the full amount of the loan or derivative exposure due us.

Although we have not suffered any material or significant losses

as a result of the failure of any financial counterparty, any such losses in the future may materially adversely affect our results of

prolonged economic slowdown, volatility in the markets, a recession, and uncertainty in the markets could impair our business and harm

our operating results.

businesses are, and will continue to be, susceptible to economic slowdowns, recessions and volatility in the markets, which may lead

to financial losses for our customers, and a decrease in revenues and operating results.

In addition, global macroeconomic conditions

financial markets remain vulnerable to the potential risks posed by exogenous shocks, which could include, among other things,

political and financial uncertainty in the U.S.

and the European Union, renewed concern about China’s economy, geopolitical conflicts,

complications involving terrorism and armed conflicts around the world, or other challenges to global trade or travel.

More generally,

because our business is closely correlated to the macroeconomic outlook, a significant deterioration in that outlook or an exogenous

shock would likely have an immediate negative impact on our overall results of operations.

is intense competition in the brokerage industry.

encounter significant competition from full-commission, no commission, online and other discount brokerage firms, as well as from financial

institutions, mutual fund sponsors, venture-backed technology and cryptocurrency firms, and other organizations.

Over the past several

years, price wars and lower or no commission rates in the discount brokerage business in general have strengthened our competitors.

addition, while the decline of commissions has been ongoing for decades, some of our competitors charging zero commissions on trades

could potentially have an adverse effect on our commission revenue.

securities brokerage industry has experienced significant consolidation, which may continue in the future, likely increasing competitive

pressures in the industry.

Consolidation could enable other firms to offer a broader range of products and services than we do, or offer

them on better terms, such as higher interest rates paid on cash held in client accounts.

We believe that such changes in the industry

will continue to strengthen existing competitors and attract additional competitors such as banks, insurance companies, providers of

online financial and information services, and others.

Many of these competitors are larger, more diversified, have greater capital resources,

and offer a wider range of services and financial products than we do.

We compete with a wide variety of vendors of financial services

for the same customers.

Many of these competitors conduct extensive marketing campaigns and may have or achieve exceptional market name

We may not be able to compete effectively with current or future competitors with stronger capital positions, greater name

recognition or who partner or combine with other larger firms.

competitors in the discount brokerage business offer services which we may not offer.

In addition, some competitors have continued to

offer zero commission execution fees that are lower than some of our published rates.

Industry-wide changes in trading practices are

expected to cause continuing pressure on fees earned by discount brokers for the sale of order flow.

Continued or increased competition

from ultra-low costs, flat-fee brokers and broader service offerings from other discount brokers could limit our growth or lead to a

decline in our customer base which would adversely affect our business, results of operations and financial condition.

Further, if we

are not able to update or adapt our products and services to take advantage of the latest technologies and standards, or are otherwise

unable to offer services to mobile and desktop computing platforms to a growing self-directed investor market, it could have a material

adverse effect on our ability to compete.

price levels in the securities markets may reduce our profitability.

price levels of securities may result in (i) reduced volumes of securities, options and futures transactions, with a consequent reduction

in our commission revenues, and (ii) losses from declines in the market value of securities we hold in investment.

In periods of low

volume, our levels of profitability are further adversely affected because certain of our expenses remain relatively fixed.

declines in market values of securities and the failure of issuers and counterparties to perform their obligations can result in illiquid

markets which, in turn, may result in us having difficulty selling securities.

Such negative market conditions, if prolonged, may lower

our revenues.

A reduction in our revenues could have a material adverse effect on our business, results of operations and financial condition.

soundness of other financial institutions and intermediaries affects us.

face the risk of operational failure, termination or capacity constraints of any of the clearing agents, exchanges, clearing houses or

other financial intermediaries that we use to facilitate our securities transactions.

As a result of the consolidation over the years

of clearing agents, exchanges and clearing houses, our exposure to certain financial intermediaries has increased and could affect our

ability to find adequate and cost-effective alternatives should the need arise.

Any failure, termination or constraint of these intermediaries

could adversely affect our ability to execute transactions, service our clients and manage our exposure to risk.

ability to engage in routine trading and funding transactions could be adversely affected by the actions and commercial soundness of

other financial institutions.

Financial services institutions are interrelated as a result of trading, clearing, funding, and counterparties

or other relationships.

We have exposure to many different industries and counterparties, and we routinely execute transactions with

counterparties in the financial industry, including brokers and dealers, commercial banks, investment banks, mortgage originators and

other institutional clients.

As a result, defaults by, or even rumors or questions about the financial condition of, one or more financial

services institutions, or the financial services industry generally, have historically led to market-wide liquidity problems and could

lead to losses or defaults by us or by other institutions.

Many of these transactions expose us to credit risk in the event of default

of our counterparty or client.

In addition, our credit risk may be exacerbated when the collateral held by us cannot be realized or is

liquidated at prices insufficient to recover the full amount of the loan or derivative exposure due us.

Although we have not suffered

any material or significant losses as a result of the failure of any financial counterparty, any such losses in the future may materially

adversely affect our results of operations.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors