FINRA Fines Firm for Order Routing Disclosure Failures

According to the AWC, during the first year, the firm did not publish any quarterly reports at all. FINRA found that in the following years, the firm published reports that were largely blank templates. The firm's reports failed to disclose key details such as routing percentages, execution venues, payment for order flow calculations, and the material aspects of its relationships with execution venues. FINRA determined that the firm failed to comply with its reporting obligations during the period.

FINRA stated that for an extended period, the firm had no written supervisory procedures addressing these obligations. FINRA noted that when procedures were later adopted, they inaccurately stated that all options orders were exempt from reporting and provided no guidance for reviewing the accuracy or completeness of disclosures. FINRA determined that the firm lacked a supervisory system reasonably designed to ensure compliance with order routing disclosure requirements.