.. BEFORE THE SECURITIES COMMISSIONER STATE OF COLORADO Order No.

I J .. L .. oL3

STIPULATION FOR CONSENT ORDER

IN THE MAITER OF ALLIANCEBERNSTEIN L.P. Respondent.

The staff of the Division of Securities ("Staff') and the Respondent, AllianceBernstein L.P. ("AB") hereby enter into this Stipulation for Consent Order in this matter as follows: 1. AB is a federally registered investment advisor noticed filed in Colorado, with a Central Registration Depository ("CRD") numbers of 108477. 2. In May 2012, AB submitted an application to the Staff for licensing Gabriel Fenton as an investment adviser representative in Colorado. Mr. Fenton resides in Colorado, holds FINRA Series 7 and 66 registrations, and until February 14, 2013, was employed by AB as a Financial Advisor ("FA") in its Denver, Colorado office. On May 16, 2012, the Staff sent a letter to AB requesting additional information concerning Mr. Fenton's application, and on June 20, 2012, a letter was sent to AB's affiliated broker-dealer Sanford C. Bernstein & Co., LLC regarding his securities sales representative license. The Staff did not receive a response to either letter. AB's application for Mr. Fenton's Colorado licensure was therefore pending but not approved during his employment at AB. 3. The Staff conducted examination of AB and its business activities pursuant to §11-51-409, C.R.S., at AB's offices located at 1225 17th St., Suite 2900, Denver, CO 80202 on December 10 and 11,2012. The examination included a review of the licensing of AB's FAs and AB' s supervisory system with respect to the licensing ofFAs. Based upon the examination, Staff asserts that starting no later than September 2012, AB in error approved Mr. Fenton to act as a licensed FA in Colorado. From at least September 2012 through December 2012, client accounts were assigned and transferred to Mr. Fenton by AB for servicing. Mr. Fenton was identified as the Financial Advisor for such client accounts and would have been designated as the person for those advisory clients to contact for assessment and servicing of such clients' advisory needs. The accounts AB assigned to Mr. Fenton during the period above generated at least $40,464.71 in fees to AB, while AB paid Mr. Fenton a "draw" as compensation for his services. 4. Pursuant to the examination, the Staff asserts that AB internally approved Gabriel Fenton to act as an investment adviser representative before he was licensed by Colorado in such capacity, and that in doing so, AB violated §11-41-401(2.5), C.R.S. AB's failure to either

(A) establish an adequate system to monitor the licensing status of Mr. Fenton and ensure that he was licensed in the appropriate jurisdictions or (B) accurately implement that system constitutes a failure to enforce AB's established written procedures, all in violation of§ 11-51-4l0(1)(i), C.R.S. 5. AB and Mr. Fenton have cooperated with Staff by responding to inquiries, providing documentary evidence and other materials, and providing Staff with access to facts relating to the investigations. 6. AB has advised the Staff of its determination to resolve its examination pursuant to the terms specified in the Consent Order (the "Order"). 7. AB agrees to review its supervisory system with respect to the licensing ofFAs, to make changes as appropriate to improve the operation of that system, and to make certain payments in accordance with the terms of the Order. 8. Solely for the purpose of terminating the investigation by the Staff, and in settlement of the issues contained in this Stipulation, AB, without admitting or denying the fmdings of fact or conclusions oflaw contained in the Order, consents to the entry of the Consent Order. The Staff and AB, desiring to resolve this matter without resort to formal litigation, stipulate and agree as follows: 1.

AB admits the jurisdiction of the Division of Securities and the Securities Commissioner.

2.

AB consents to entry of the Consent Order by the Securities Commissioner, which is incorporated herein by reference

3.

By entering into this Stipulation, AB neither admits nor denies that any of the allegations or grounds asserted by the Staff and set forth in the Stipulation are true.

4.

By entering into this Stipulation, AB has waived the right to a formal hearing pursuant to §11-51-606(1), C.R.S and §§24-4-104 and 105, C.R.S.; the right to be represented by counsel chosen and retained by it; the right to present a defense through oral or documentary evidence and to cross-examine witnesses at such hearing; and the right to seek judicial review of the terms, agreements and conditions in this Stipulation or the Consent Order as provided in §§11-51607, C.R.S., and 24-4-106, C.R.S.

5.

Nothing in this Stipulation or Consent Order shall preclude non-party Gabriel Fenton from applying for, or being approved for, an investment adviser representative license or securities sales representative license in Colorado at a future date.

6.

AB states that no promise of any kind or nature whatsoever was made to it to 2

induce it to enter into this Order and that it has entered into this Order voluntarily.

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Dated this _5_ dayofMarch, 2013.

AllianceBernstein L.P.

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By

Name: Title:

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Dated this~ -- day of March, 2013.

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Colorado Division oT :Ies

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By: Gerald Rome Deputy Securities Commissioner

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BEFORE THE SECURITIES COMMISSIONER STATE OF COLORADO Order No.

I 3 ~ t - JJ

CONSENT ORDER IN THE MATTER OF ALLIANCEBERNSTEIN L.P. Respondent.

THIS MAITER is before Fred J. Joseph, Securities Commissioner for the State of Colorado ("Securities Commissioner"), on the Stipulation for Consent Order between the Staff of the Colorado Division of Securities ("Staff') and Respondent AllianceBernstein L.P. ("AB"). After reviewing the Stipulation, grounds therein, and further being advised in the premises, the Securities Commissioner makes the following Findings of Fact and Conclusions of Law as follows: FINDINGS OF FACTS

l. The Securities Commissioner has jurisdiction over AB and the subject matter of this action pursuant to the provisions of the Colorado Securities Act,§§ 11-51-101 through 803, C.R.S. 2. The Securities Commissioner acknowledges that by entering into this Stipulation, AB has neither admitted nor denies that any of the allegations or grounds set forth in the Stipulation or otherwise asserted by the Staff are true. 3. By entering into the Stipulation, AB has waived the right to a formal hearing pursuant to §11-51-606(1), C.R.S and §§24-4-104 and 105, C.R.S.; the right to be represented by counsel chosen and retained by it; the right to present a defense through oral or documentary evidence and to cross-examine witnesses at such hearing; and the right to seek judicial review of the terms, agreements and conditions in this Stipulation or the Consent Order as provided in §§11-51-607, C.R.S., and 24-4-106, C.R.S. 4. AB further waived the findings required by §11-51-410(1), C.R.S., and pursuant to §1151-704(2), C.R.S., that the entry of this Order is necessary and appropriate in the public interest and is consistent with the purposes and provisions of the Colorado Securities Act. NOW, THEREFORE, based on the foregoing, it is ORDERED as follows: 1. AB hereby shall implement and maintain an adequate supervisory and compliance system with a view to detecting and preventing violations of the Colorado Securities Act, including employing or otherwise engaging unlicensed persons. 2.

AB is hereby ordered to pay within ten days of the date of this Order the sum of

TWENTY THOUSAND TWO HUNDRED AND THIRTY-TWO DOLLARS AND THIRTY -SIX CENTS ($20,232.36) to the State of Colorado as a monetary penalty, which amount constitutes one half of the fees paid to AB by the client accounts assigned by AB to Gabriel Fenton while his investment adviser license application was still pending with the Staff. 3. Violation by AB of any provision of the Stipulation for Consent Order or this Order may constitute grounds for initiation of further proceedings against AB. In the event such action is conunenced, the Stipulation for Consent Order, this Order, and the factual basis for this matter shall be admissible as evidence in any such action.

Dated this;>t,-iday of March, 2013.

FRED J. JOSEPH Securities Commissioner

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