In its September report, the Financial Industry Regulatory Authority listed the companies it has penalized for cases of misconduct and violation of rules.
On July 2, FINRA imposed a fine on CV Brokerage Inc. of $100,000. FINRA found that the firm failed to establish and maintain a supervisory system and written supervisory procedures for the participation of firm-registered representatives in private securities transactions. The firm did not admit or deny FINRA's findings in their respective cases.
On July 10, Clearpool Execution Services LLC was fined $473,000, of which $43,000 is payable to FINRA. The remaining balance is to be paid to other self-regulatory organizations in related matters. FINRA identified and reviewed potentially manipulative trading activity by a foreign, unregistered proprietary trading fund that was an affiliate and customer of the firm. The firm used more than a thousand foreign, unregistered individual traders for potentially manipulative trading. Clearpool Execution Services also failed to establish, maintain and enforce written procedures reasonably designed to achieve compliance with applicable securities laws and regulations. The firm did not admit or deny FINRA's findings in their respective cases.
On July 11, FINRA imposed a $100,000 BNP Paribas Securities Corp. for failing to report, and to timely report, to the FINRA/Nasdaq Trade Reporting Facility transactions effected pursuant to the exercise of an over-the-counter option that required a special trade report modifier.
On July 17, the SEC issued a decision in which the Merrimac Corporate Securities Inc. was suspended from FINRA membership in all capacities for 30 business days. The company was also fined $225,000 and required to retain an expert to evaluate and approve its written supervisory procedures. The SEC found that the company and Chief Compliance officer Robert Nash provided documents to FINRA on which they knew signatures purporting to reflect supervisory review had been falsified without informing FINRA of the falsification. The SEC also found that the firm engaged in the unregistered offer and sale of 56.5 million shares of penny stocks not subject to an exemption from registration.
