BROWSE BY TOPIC
- Investments - Strategies
- Investments - Unsuitable
- Wall Street News
- Investor Protection
- Compliance Concepts
- Bad Brokers
- Investments - Private
- Rules & Regulations
- Bad Advisors
- Boiler Rooms
- Terminations/Cost Cutting
- General News
- Donald Trump & Co.
- Big Banks
- Regulatory Sanctions
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
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.
NEWSLETTERS & ALERTS
Failed Best Execution on Riskless Principal Bond Trades
by Howard Haykin
A Golden Valley, MN-based broker-dealer agreed to pay $22,500 in fines and restitution, and to revise its WSPs, to settle FINRA charges that it failed to provide best execution when, trading for its own account, it sold or bought corporate bonds to or from customers.
The firm is a self-described independent, full-service financial services firm providing private client and investment banking services to individual, institutional and corporate customers.
FINRA FINDINGS. The Fixed Income Investigations Team of FINRA Market Regulation conducted a review of the firm's pricing of corporate bond transactions and related supervisory requirements for the third quarter of 2016. For that period, the staff cited 7 transactions on which the firm took too large a profit and, accordingly, it recommended restitution to customers.
- In each instance, the firm had conducted what amounted to a riskless principal transaction - i.e., when trading for its own account, the firm sold (or bought) corporate bonds to (or from) customers.
- Whereas the firm took percentage profits ranging from 3.28% to 3.73% on its principal cost basis of each transaction, FINRA trimmed the acceptable profit down to 2.5%.
- The firm was deemed to have violated FINRA Rule 2121 (Fair Prices and Commissions), FINRA Rule 3110 (Supervision), and FINRA Rule 2010.
- Monetary sanctions broke down, as follows: $10K fine for fair pricing rule violations; $7.5K fine for supervisory rule violations; $5K in restitution to customers.
This case was reported in FINRA Disciplinary Actions for October 2018.
For details on this case, go to ... FINRA Disciplinary Actions Online, and refer to Case #2016052229401.