Firm Settles Charges for Unreported Fractional Share Trades

A firm settled FINRA charges for failing to report millions of fractional share trades executed in a principal capacity with customers.

According to the AWC, over a 12-year period, the firm failed to report over five million fractional share trades with customers to the FINRA/Nasdaq Trade Reporting Facility and the Over-the-Counter Reporting Facility. As a result, the firm did not pay the regulatory transaction fees associated with these trades. 

FINRA found that the firm violated FINRA Rules 6380A and 6622 ("Transaction Reporting"), 3110 ("Supervision") and 2010 ("Standards of Commercial Honor and Principles of Trade").

To settle the charges, the firm agreed to (i) a censure, (ii) pay a $175,000 fine and (iii) an undertaking to pay the regulatory transaction fees for unreported fractional share trades.