FINRA (along with NYSE Arca, NASDAQ, NASDAQ OMX BX, and BATS) announced that they have censured and fined Hold Brothers On-Line Investment Services, LLC (a New York-based self-clearing broker-dealer) $3.4 million for a number of violations including manipulative trading activities and failure to comply with anti-money laundering requirements. Hold Brothers primarily operates as a day-trading firm by facilitating direct market access (largely foreign, primarily Chinese) customers. It appears that a major part of the manipulation involved the firm attempting to trick the trading algorithms of
The NFA released July 2013 revisions to the Financial Requirements Section 16 and the related interpretive notice regarding cleared swaps customer collateral accounts. These updates are available in five appendices of policies that include: Compliance with theExchange Act Rule 15c3-1: the calculation of haircut charges on securities; additionally, charges on the more common securities are reviewed: government securities and Canadian debt obligations, municipal securities, other municipal securities, money market funds, commercial paper, bankers' acceptances and certificates of deposit, non
FINRA settled charges with a firm for (i) selling billions of unregistered microcap shares and (ii) failing to implement supervisory and/or anti-money laundering ("AML") programs that were tailored adequately to detect "red flags" for suspicious activity connected to microcap shares. FINRA also suspended and fined two of the firm's business executives. Specifically, FINRA found that the firm: did not "reasonably design" its supervisory system to satisfy its affirmative obligation to determine whether the microcap securities that it liquidated for clients were registered with the SEC or
The CFTC approved a final rule to amend the definitions of "portfolio reconciliation" and "material terms" in order to facilitate the portfolio reconciliation of swaps.