FINRA disciplinary actions taken against firms and individuals due to violations of FINRA rules, federal securities laws and MSRB rules.
Clearpool Execution Services, LLC
The Firm was censured and fined $473,000, of which $43,000 was paid to FINRA and the remaining paid to other self-regulatory organizations for failing to create and maintain a compliance system fulfilling FINRA requirements. It was found that the Firm’s customer and affiliate, a foreign, unregistered proprietary trading fund, participated in manipulative trading activity. The Firm executed these manipulative trades and also introduced its order flow to other broker-dealers for execution. After the fund had traded through unregistered, foreign individual traders, FINRA surveillance alerts were triggered for layering and spoofing. Although the Firm was on notice for manipulative trading, the Firm proceeded to terminate trading access for individual traders and continued to execute trades from the fund. FINRA Case #2014042373804
Citigroup Global Markets Inc.
The Firm was fined $55,000 for failing to report reportable options positions to the large options position reporting system. The failure to report was due to a programming error design flaw in its reporting logic in regard to reporting proprietary positions as acting-in-concert. This resulted in reporting positions in the wrong format and with an incorrect date. FINRA Case #2014043477301
James Thomas Booth
Booth was barred from association with a FINRA member Firm for converting customer funds. It was found that Booth was given at least $1,000,000 to invest on customers’ behalf, but instead deposited the funds into a personal account. Booth then used the funds for personal use. FINRA Case #2019062787101
Fortino R. Rivera
Rivera was barred from association with any FINRA member for providing false information to FINRA during an on-the-record testimony. Rivera claimed he was not aware of any joint account held with a senior customer of his member firm at another member firm and that the customer had opened the account without his knowledge. It was found that Rivera had opened the account with the senior customer and accessed the online portal many times. FINRA Case #2018059735201
Ricardo de la Garza Emerich
De la Garza Emerich was fined $5,000 and suspended from association with any FINRA member for 45 days. It was found that de la Garza Emerich and his assistant utilized email addresses that were not approved by his member firm to conduct business communications. The email address was not disclosed to the member Firm and therefore not captured, resulting in the Firm’s failure to preserve books and records, which compromised Broker-Dealer compliance. FINRA Case #2017055355301
Dennis Carey Ward
Ward was fined $5,000 and suspended from association with any FINRA member for four months. It was found that Ward failed to disclose 19 tax liens on his Form U4 in a timely manner. The liens were filed by the IRS and Pennsylvania and totaled over $147,000. Ward was alleged to have filed the liens on average 1,000 days late. FINRA Case #2018058322401
Click here to read the Disciplinary Brief in its entirety.
FINRA disciplinary actions can be very costly and harm your firm’s reputation. Please contact an ARG Analyst with any questions regarding the matters discussed, or to learn the benefits of our FINRA consulting services.