FINRA has published the notice of disciplinary cases for April 2013 online. A few cases I think are worthy of discussion.
In one case, a firm agreed to settle an action through an AWC and was censured and fined $150,000. The findings included that the firm failed to establish and maintain an adequate supervisory system for supervising a representative's written communications in a foreign language when none of the firm's supervisory folks were fluent in that foreign language. FINRA also found that the firm failed to supervise employee trading at other firms, and failed to have an adequate information barrier program in place, among other things. Case No. 2011025644101.
In another case, FINRA made findings that a firm offered private placement, allegedly exempt from registration under Regulation D, to individuals just a few days after an initial phone call with the offeree. Such contact was deemed to be general solicitation and the firm properly failed to supervise the sale of the offering, among other things. The firm was censured and fined $25,000. Case No. 2011025614701.
Of course there were also the typical cases we come to expect each month including improper use of discretion, forgery, selling away, undisclosed outside business activities, trade reporting, etc.
Further, FINRA issued a separate press release earlier this month on some AML cases. By now, firms should understand that AML compliance continues to be an area of focus for regulators. Forewarned is forearmed.
Finally, the SEC recently issued an opinion in an appeal to the SEC for review of a FINRA enforcement action. The Commission affirmed FINRA's findings of violation and sanctions. In this case, FINRA barred a broker based on findings that he willfully failed to disclose an injunction entered against him, as well as the revocation of his CPA license, on about 36 Forms U4 filed with about 34 different employing firms over a 6+ year period. The SEC here again discussed the willfulness concept under the securities laws, and the resulting statutory disqualification that flows from such a finding of willfulness (for more on the wilfullness concept, see the posts under the category of Form U4 issues - you'll find a topical index on the right-hand side of the blog).