Securities principal suspended and fined for alleged violations of Reg BI
The principal recommended speculative, unrated debt securities to customers with a moderate risk tolerance resulting in high concentrations of their liquid net worth in alternative investments.
The recommendations made were not in the best interest of the customers based on their investment profile and appetite for risk.
FINRA Rule 2010
FINRA Rule 2111
SEA 1934 Rule 15l-1
SEC Reg BI
Former securities representative suspended and fined for alleged material misrepresentation
The representative drafted, signed and disseminated three asset verification letters without obtaining approval from the firm. The letters contained various misrepresentations including overstating the value of the individual’s assets.
In addition the representative also engaged in an undisclosed business activity on behalf of a start-up decentralized crypto exchange.
FINRA Rule 2010
FINRA Rule 3270
Former securities representative barred for allegedly refusing to provide information and documents or to appear for on-the-record testimony
FINRA Rule 2010
FINRA Rule 8210
JVM Securities censured and fined for alleged Reg BI failings
The firm’s policies and procedures contained no provisions relating to Reg BI until March 2022. After that period they discussed Reg BI only in general terms that was not tailored to the firm’s business.
The firm also failed to establish and maintain a supervisory system reasonably designed to achieve compliance with its Form CRS obligation.
Finally the firm failed to file required documents related to three private placements in a timely fashion and its supervision of regulatory document filing was inadequate.
The firm has agreed to the imposition of an undertaking requiring it to certify in writing the remediation of the issues identified.
FINRA Rule 2010
FINRA Rule 3110
SEA 1934 Rule 15l-1
SEC Reg BI
Product representative suspended and fined for allegedly falsely certifying that he had personally completed the continuing education required to hold an insurance license
Another person had completed 15 hours of insurance continuing education on his behalf.
FINRA Rule 2010
Former products representative suspended and fined for allegedly participating in an outside business activity
The representative worked as a marketing affiliate for a company owned and operated by three other registered representative of the firm, receiving commission for successfully referring customers to the company.
FINRA Rule 2010
FINRA Rule 3270
Pershing censured and fined for allegedly failing to report millions of fractional share trades
Between 1997 and 2023 the firm also failed to establish, maintain and enforce a supervisory system for the reporting of such trades. A supervisory framework for such reporting was put in place by July 2022, but a system was not implemented until June 2023.
The firm has agreed to the imposition of an undertaking requiring it to pay the regulatory transaction fees for the unreported trades executed during this time period.
FINRA Rule 2010
FINRA Rule 3110
NASD Rule 2110
NASD Rule 3010
StoneX Financial censured and fined for allegedly failing to meet its best execution obligations for some orders in OTC securities
The firm did not integrate OTC Link messages into its order management system used to execute orders. The resulting manual process meant that the firm did not provide best execution in connection with 1,674 orders.
In addition the firm’s system excluded reviews of prices available in OTC Link messages, which meant that the firm could not reasonably supervise its best execution obligations for these orders in OTC securities.
A restitutionary payment of $27,074.36 plus interest has been ordered.
FINRA Rule 2010
FINRA Rule 3110
FINRA Rule 5310
Securities Principal and CCO suspended and fined for allegedly failing to establish, maintain and enforce a supervisory system designed to ensure compliance with rules prohibiting market manipulation
The firm’s WSPs designated the principal as “responsible for establishing and maintaining the firm’s systems and procedures to detect, investigate, and address potentially manipulative trading in exchange-listed and traded securities.”
The WSPs the principal was responsible for did not:
- reasonably describe how the firm would detect and prevent potentially manipulative trading;
- provide reasonable guidance to personnel responsible for the surveillance of potentially manipulative trading;
- did not identify exception reports, what conduct a reviewer should escalate or how issues should be documented or escalated.
The exception reports used to detect potentially manipulative trading did not contain information that a review would need to assess whether this had taken place. Where potentially manipulative trading was identified the principal failed to ensure that this was reasonably investigated.
Finally the principal failed to investigate and address potentially manipulative wash trades in an account of the firm’s foreign affiliate.
FINRA Rule 2010
FINRA Rule 3110
Associated person charged with allegedly making false or misleading statements
The associated person falsely claimed that he had received a passing score on the SIE exam when he had in fact failed it.
This is a complaint and not an AWC.
FINRA Rule 2010
Former associated person barred for allegedly refusing to appear for on-the-record testimony
FINRA Rule 2010
FINRA Rule 8210
Former securities representative suspended and fined for allegedly falsely certifying that he had personally completed the continuing education required to hold an insurance license
Another person had completed 15 hours of insurance continuing education on his behalf.
FINRA Rule 2010
Securities representative suspended and fined for allegedly falsely certifying that he had personally completed the continuing education required to hold an insurance license
Another person had completed 15 hours of insurance continuing education on his behalf.
FINRA Rule 2010
Former banking representative charged with allegedly failing to provide information and documents
This is a complaint and not an AWC
FINRA Rule 2010
FINRA Rule 8210
| Unless otherwise noted all respondents accepted and consented to FINRA’s findings without admitting or denying them. |