FINRA Fines Firm for Failing to Disclose Required Municipal Underwritings

A municipal securities firm settled FINRA charges for failing to file accurate and timely quarterly reports with the Municipal Securities Rulemaking Board ("MSRB") and for failing to establish, maintain, and enforce an adequate supervisory system.

According to the Acceptance, Waiver and Consent, FINRA found that over a five-year period, the firm filed MSRB Rule G-37 ("Political Contributions and Prohibitions on Municipal Securities Business and Municipal Advisory Business") reports that were late, incomplete and inaccurate. FINRA found that the firm "failed to disclose 60 municipal underwritings for which the firm acted in a managerial capacity, including as a senior manager, co-senior manager, or co-manager," and that the firm filed the required reports "between one and 645 days late." In addition, FINRA said the firm failed to designate a person to oversee the maintenance of the reportable information or to identify the sources that provided the information for the G-37 forms. As a result of the above failures, the firm violated MSRB Rules G-37 and Rule G-27 ("Supervision").

To settle the charges, the firm agreed to (i) a censure, (ii) a $30,000 fine and (iii) cease and desist from further violations of MSRB Rules G-37 and G-27.