A broker-dealer settled FINRA charges for failing to comply with supervisory and recordkeeping requirements.
In a Letter of Acceptance, Waiver and Consent, FINRA stated that the broker-dealer did not adequately comply with the recordkeeping requirements under SEA Rule 17a-4(f). Specifically, FINRA found that the broker-dealer's supervisory system (i) failed to include written procedures for compliance with SEA Rule 17a-4(f) and (ii) did not comply with the specific requirements for storing required records electronically relating to notification, audits, granting access to a third-party vendor and safeguarding the records from loss, alteration or destruction. As a result, FINRA determined, the broker-dealer violated NASD Rules 3010 and 2110 and FINRA Rules 3110 ("Supervision") and 2010 ("Standards of Commercial Honor and Principles of Trade").
To settle the charges, the broker-dealer agreed to (i) a censure, (ii) a $1,000,000 fine and (iii) certify, within 180 days, that the firm has implemented reasonable supervisory systems and written procedures.
Primary Sources
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
