Former products representative 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 making investment recommendations that were not in the customer’s best interest
The recommendations to purchase closed-end funds were not consistent with the customer’s investment profile, including age, limited finances and moderate risk tolerance.
FINRA Rule 2010
SEA 1934 Rule 15l-1
SEC Reg BI
Former products representative suspended and fined for allegedly forging customer signatures
Genuine signature pages were appended to new forms in order to accommodate customers.
FINRA Rule 2010
FINRA Rule 4511
HSBC Securities censured and fined for alleged TRACE reporting shortcomings
The firm failed to report approximately 5,635 transactions in corporate debt within 15 minutes of the time of execution.
In addition the firm failed to reasonably supervise TRACE reporting by not providing reasonable guidance for supervisors to address traders’ repeated instances of late reporting.
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
Former unregistered associate charged with allegedly failing to provide information or documents requested
This is a complaint and not an AWC.
FINRA Rule 2010
FINRA Rule 8210
Unregistered associate suspended and fined for allegedly falsely certifying that she had personally completed the continuing education required to hold an insurance license
Another person had completed 15 hours of insurance continuing education on her behalf.
FINRA Rule 2010
Former products representative suspended and fined for allegedly opening and maintaining an outside securities account without authorization
FINRA Rule 2010
FINRA Rule 3210
Securities representative suspended for allegedly recommending trades that were not in the best interest of a customer
The representative exercised de facto control over the customer’s account and recommended transactions that were loss-making and unsuitable, but that generated significant trading costs and commissions.
FINRA Rule 2010
FINRA Rule 2111
Securities representative suspended and fined for allegedly engaging in an outside business activity without notice to or approval from his firm
The representative operated a bourbon tasting business and failed to disclose this despite being aware of the policies applying to outside business activities.
FINRA Rule 2010
FINRA Rule 3270
Celadon Financial Group censured and fined and its CCO suspended and fined for alleged AML compliance program as well as Regulation NMS failings
The firm published inaccurate quarterly Regulation NMS Rule 606 reports. A third-party vendor retained by the firm could not accurately process the firm’s trade data and the resulting reports, based on historical data and uncorrected by the firm, inaccurately stated the:
- percentages of the firm’s non-directed equity orders submitted on a held basis;
- percentages of the firm’s non-directed options orders;
- venues to which the largest number of total non-directed orders were routed for execution in equities and options;
- the net aggregate amount of any payment for order flow, profit-sharing, transaction fees and rebates received by the firm for specified types of non-directed orders; and
- material aspects of the firm’s relationships with each execution venue.
The firm’s WSPs were not reasonably designed to ensure compliance with Rule 606, involving only a random review of five trades per quarter while the firm effectively processed 10,000 transactions in NMS stocks each month.
The firm’s AML program was not reasonably tailored to its business and its WSPs lacked appropriate risk-based procedures for conducting ongoing customer due diligence. The firm failed to identify, investigate or report suspicious trading by the customers as a result.
Specifically the firm was aware of numerous red flags related to a group of approximately 10 customers transactiing in low-priced securities.
These red flags included news reports indicating possible criminal, civil and regulatory violations involving the customers. Despite this the firm proceeded to execute over 3,600 transactions in low-priced securities for a total principal amount of approximately $299m.
FINRA Rule 2010
FINRA Rule 3310
FINRA Regulatory Notice 19-18
NASD NTM 02-21
SEA 1934 Rule 606
SEC Reg NMS
Securities representative suspended and fined for alleged improper use of funds
The representative transferred securities from his daughter’s Uniform Trust Minor Account (UTMA), of which he was a custodian, to his own brokerage account. He subsequently sold 500 shares of the stock held in this account.
Under the rules applying to UTMA accounts these assets were the property of the minor beneficiary and could not be legally divested by the custodian.
In addition the custodial property was meant to be held in an account that was separate and distinct from all other property.
FINRA Rule 2010
FINRA Rule 2150
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
| Unless otherwise noted all respondents accepted and consented to FINRA’s findings without admitting or denying them. |