Broker-Dealer Fined for Trade Confirmation Disclosure Violations

A broker-dealer settled FINRA charges for sending incomplete or incorrect trade confirmations to customers.

According to FINRA, in separate instances, the broker-dealer (i) failed to disclose each role it assumed when acting in multiple roles within the same transaction, (ii) incorrectly labeled trade confirmations as average price executions, in part due to a programming error, and (iii) did not disclose when it acted as a market maker, again due to a programming error.

FINRA determined that the broker-dealer violated Exchange Act Section 17(a) ("Records and reports"), Exchange Act Rule 10b-10 ("Confirmation of transactions") and Rule 17a-3 ("Records to be made by certain exchange members, brokers and dealers"). The broker-dealer was also found to have violated FINRA Rule 2010 ("Standards of Commercial Honor and Principles of Trade"), Rule 2232 ("Customer Confirmations") and Rule 4511 ("General Requirements").

To settle the charges, the broker-dealer agreed to (i) a censure and (ii) a civil monetary penalty of $300,000.