BROWSE BY TOPIC
- Bad Brokers
- Compliance Concepts
- Investor Protection
- Investments - Unsuitable
- Investments - Strategies
- Investments - Private
- Features/Scandals
- Companies
- Technology/Internet
- Rules & Regulations
- Crimes
- Investments
- Bad Advisors
- Boiler Rooms
- Hirings/Transitions
- Terminations/Cost Cutting
- Regulators
- Wall Street News
- General News
- Donald Trump & Co.
- Lawsuits/Arbitrations
- Regulatory Sanctions
- Big Banks
- People
TRENDING TAGS
Stories of Interest
- Sarah ten Siethoff is New Associate Director of SEC Investment Management Rulemaking Office
- Catherine Keating Appointed CEO of BNY Mellon Wealth Management
- Credit Suisse to Pay $47Mn to Resolve DOJ Asia Probe
- SEC Chair Clayton Goes 'Hat in Hand' Before Congress on 2019 Budget Request
- SEC's Opening Remarks to the Elder Justice Coordinating Council
- Massachusetts Jury Convicts CA Attorney of Securities Fraud
- Deutsche Bank Says 3 Senior Investment Bankers to Leave Firm
- World’s Biggest Hedge Fund Reportedly ‘Bearish On Financial Assets’
- SEC Fines Constant Contact, Popular Email Marketer, for Overstating Subscriber Numbers
- SocGen Agrees to Pay $1.3 Billion to End Libya, Libor Probes
- Cryptocurrency Exchange Bitfinex Briefly Halts Trading After Cyber Attack
- SEC Names Valerie Szczepanik Senior Advisor for Digital Assets and Innovation
- SEC Modernizes Delivery of Fund Reports, Seeks Public Feedback on Improving Fund Disclosure
- NYSE Says SEC Plan to Limit Exchange Rebates Would Hurt Investors
- Deutsche Bank faces another challenge with Fed stress test
- Former JPMorgan Broker Files racial discrimination suit against company
- $3.3Mn Winning Bid for Lunch with Warren Buffett
- Julie Erhardt is SEC's New Acting Chief Risk Officer
- Chyhe Becker is SEC's New Acting Chief Economist, Acting Director of Economic and Risk Analysis Division
- Getting a Handle on Virtual Currencies - FINRA
ABOUT FINANCIALISH
We seek to provide information, insights and direction that may enable the Financial Community to effectively and efficiently operate in a regulatory risk-free environment by curating content from all over the web.
Stay Informed with the latest fanancialish news.
SUBSCRIBE FOR
NEWSLETTERS & ALERTS
FOLLOW US
Firm Caught for Lax Supervision Over Research Analysts
by Howard Haykin
An Albany, NY-based broker-dealer agreed to settle FINRA charges that it failed to enforce procedures regarding the distribution of research between the firm’s research and its trading and sales personnel, and failed to adequately supervise the process by which the firm distributed research reports to customers. The firm, which had no relevant disciplinary history, will pay $75K.
FINRA FINDINGS. For most of 2014, the firm employed some 5 research analysts who covered approximately 80 subject companies. And the conduct of those analysts and their supervisory personnel were governed by policies and procedures ("WSPs"), which restricted the improper distribution of information the research department.
Yet, research was improperly disseminated between research analysts and the firm's trading and sales personnel. And finalized research reports were improperly distributed to customers. And, in doing so, the firm violated NASD Rule 3010 and FINRA Rules 5280 and 2010.
During the relevant period, ...
- While the firm’s WSPs prohibited research analysts from "discussing pending research reports with trading personnel prior to public dissemination,” research personnel routinely sent finalized copies of research reports to sales and trading personnel at the Firm before disseminating the research via its internet research distribution platform.
'Finalized Research Reports' were reports that the Firm had completed but not yet disseminated via the Firm's internet research distribution platform.
- Even though the firm’s WSPs required that research be "distributed to all accounts and other recipients at the same time," the research department routinely sent finalized research reports to the Firm's trading and sales personnel who, in turn, emailed the reports to certain of the Firm's customers, chosen based on their determinations about which customers were likely to be interested in receiving the reports.
Consequently, the firm failed to prevent pending research reports from being distributed to some of its customers before others received the reports via the Firm's internet research distribution platform.
This case was reported in FINRA Disciplinary Actions for March 2018.
For details on this case, go to ... FINRA Disciplinary Actions Online, and refer to Case #2014039030201.
