Kiersten Fletcher

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FINRA continues to discipline broker-dealers that fail to detect and investigate so-called “red flags” of suspicious account activity. Yesterday, FINRA announced a $1 million fine against COR Clearing LLC (the “Firm”) – formerly Legent Clearing LLC – citing its failure to implement procedures designed to detect suspicious account activity and to report that activity once detected. In its settlement order, FINRA found a wide range of violations, but its emphasis was on anti-money laundering…
The price tag for failing to detect suspicious activity in penny stocks through an adequate anti-money laundering program continues to increase.  Oppenheimer & Co., Inc. recently agreed to pay FINRA more than $1.4 million to settle a disciplinary proceeding brought in May 2013 based on problems in the firm’s supervisory system and anti-money laundering program. FINRA’s release details how seven brokers in five branches sold more than one billion shares of twenty low priced, speculative…
Firms that let suspicious account activity go undetected have caught FINRA’s attention, and have paid for their oversight – or, indeed, lack of oversight — in the form of penalties and employee suspensions, as detailed in recently-publicized settlements. While, at first blush, each settlement – with Atlas One Financial Group, Firstrade Securities Inc. and World Trade Financial Corporation – may seem unrelated, underlying each is FINRA’s finding that the institution was on notice of highly…