FINRA Fine Puma AML on Stocks

On Mar. 15, FINRA fined Puma Capital $70k for AML penny stock.

  • Puma Capital fined and required to certify compliance with Bank Secrecy Act.
  • FINRA Rule 3310, S. 5 of Securities Act. distribution of unregistered securities.

Alleged Violations

  • Lacked an efficient AML program designed to achieve and monitor compliance.
  • Did not report potentially suspicious activity on microcap securities liquidation.
  • Red flags of suspicious activity were raised but firm did not detect, investigate.
  • Given high volume of transactions, firm did not adequately design their manual.
  • Customers liquidated over 17mn microcap shares, generating $5.1mn proceeds.
  • Failed to enforce supervisory system, and procedures designed for compliance.
  • Inadequate diligence in determining whether microcap securities traded by its
    customers using DVP accounts were registered, or exempted from registration.
  • Compliance only a periodic post-trade review a month after trading took place.