28.

COMMITMENTS AND CONTINGENCIES

Lease Commitments

The Company leases office space in several cities under agreements. As of

December 31, 2020

, future minimum commitments under these operating leases are as follows.

FUTURE LEASE COMMITMENTS
(Dollars in Thousands)

	Lease		Less: Sublease			Net Commitment
2021	$	1,496	$	(98	)	$	1,398
2022		1,188		-			1,188
2023		1,091		-			1,091
2024		1,055		-			1,055
2025		982		-			982
2026 and Thereafter		3,112		-			3,112
	$	8,924	$	(98	)	$	8,826

Rent expense for the years ended

December 31, 2020

2019

, and

2018

was

$1,521,

$1,555,

and

$1,380,

respectively, and was included in business development, occupancy, equipment expense in the consolidated statements of operations. Rent expense was recorded net of sublease income of

$318,

$280,

and

$226,

for the year ended

December 31, 2020

2019

, and

2018

, respectively. The lease commitments noted above represent the actual cash commitments and will

not

necessarily match the amount of rent expense recorded in the consolidated statements of operations. See note

Legal and Regulatory Proceedings

The Company's U.S. broker-dealer subsidiary, JVB is a party to litigation commenced on

August 7, 2019,

in the Supreme Court of the State of New York under the caption

VA Management, LP v. Odeon Capital Group LLC; Janney Montgomery Scott LLC; C&Co/PrinceRidge LLC; and JVB Financial Group LLC

. The plaintiff, VA Management, LP (f/k/a Visium Asset Management, LP) (“Visium”), alleges that the defendants, as

third

party broker-dealers, aided and abetted Visium's portfolio managers' breaches of their fiduciary duties by assisting in carrying out a fraudulent “mismarking scheme.” Visium is seeking in excess of

billion in damages from the defendants including disgorgement of the compensation paid to Visium's portfolio managers, restitution of and damages for the investigative and legal fees, administrative wind down costs, and regulatory penalties paid by Visium as a result of the “mismarking scheme,” direct and consequential damages for the destruction of Visium's business, including lost profits and lost enterprise value, and attorneys' fees and costs. JVB and the other defendants filed a motion to dismiss the complaint in lieu of an answer on

October 16, 2019.

April 29, 2020,

the Court issued a ruling denying the motions to dismiss filed by each of the defendants. On

May 20, 2020,

JVB filed a Notice of Appeal with the Appellate Division of the Supreme Court, First Department. The other defendants also appealed. On

July 13, 2020,

JVB and the other defendants filed a joint appellate brief. On

August 12, 2020,

plaintiff filed its opposition brief. On

August 21, 2020,

JVB and the other defendants filed a joint reply brief. On

December 10, 2020,

the Appellate Division of the Supreme Court, First Department reversed the Court's decision and granted the defendants motion to dismiss. On

January 11, 2021,

Visium filed with the Court of Appeals of New York State a Motion for Leave to Appeal the decision of the Appellate Division. On

January 22, 2021,

the defendants filed a joint Opposition to Motion for Leave to Appeal.

In connection with certain routine exams by FINRA, FINRA claimed that during the period

July 2013

through

December 2015 (

the “Relevant Period”), JVB did

not

have certain controls in place that were reasonably designed to prevent the entry of (

) orders that exceed appropriate pre-set credit or capital thresholds in the aggregate for each customer and the broker or dealer; and (

) erroneous orders, including duplicative orders. JVB, without admitting or denying any allegations, consented to a Letter of Acceptance, Waiver and Consent to resolve certain alleged deficiencies in its Exchange Act Rule

15c3

procedures and its related risk management controls during the Relevant Period. The agreement was accepted by FINRA on

November 6, 2018.

As a result, the Company recorded a net expense of

$50

during the

third

quarter of

2018

and paid the fine of

$50

during the

fourth

quarter of

2018.

In addition to the matters set forth above, the Company is a party to various routine legal proceedings, claims, and regulatory inquiries arising out of the ordinary course of the Company's business. Management believes that the results of these routine legal proceedings, claims, and regulatory matters will

not

have a material adverse effect on the Company's financial condition, or on the Company's operations and cash flows. However, the Company cannot estimate the legal fees and expenses to be incurred in connection with these routine matters and, therefore, is unable to determine whether these future legal fees and expenses will have a material impact on the Company's operations and cash flows. It is the Company's policy to expense legal and other fees as incurred.