On Nov. 15, FINRA fined Cadaret $800k for suitability of annuities. Cadaret, Grant & Co.,fined $800 and required to retain independent consultant. Consultant to conduct comprehensive review of adequacy of policy, procedures. Review staffing, training relating to the rule violations identified in enforcement. Supervisory Failures Failed to establish a reasonably-designed supervisory system in business areas.…
Read more
FINRA Fine $1mn VA Suitability
On Sep. 17, FINRA fined four firms $1mn re VA suitability issues. FSC Securities Corporations, fined $200k, Royal Alliance Associates fined $350k. SagePoint Financial, fined $200k and Woodbury Financial Services, fined $250k. Failures Procedures did not specifically address the suitability issues related to different surrender periods, fees and costs of the different variable annuity share…
Read more
ESMA Suitability Requirements
On Jul. 24, ESMA issued report on MiFID suitability requirements. Follows ESMA Apr. 2016 peer review of MiFID suitability requirements. Follows ESMA's May 2018 final guidelines on MIFID II suitability rules. Follow-Up Report Review found improvements with NCA supervision of these suitability requirements. Issued follow-up report regarding oversight by national competent authorities (NCA). Report assesses…
Read more
FINRA Fines for Unsuitable Trading
On Jul. 16, FINRA fined Capitol $100k for unsuitable fund advice. Capitol Securities Management, fined $100k, with $44.7k restitution to clients. For conducting unsuitable short-term trading, in unit investment trusts (UITs). Unsuitable Trades Failed to establish supervisory system to prevent unsuitable short-term trades. Did not enforced UIT switch form per policy, to detect premature sales…
Read more
FINRA Fine VA Sales Suitability
On Jun. 15, FINRA fined Park Avenue Securities $300k re annuities. Failed to address suitability for sales of different variable annuity share classes. No surveillance to see if representatives had potentially inappropriate VA rates. Did not provide training to representatives to sell on the various share classes. Did not establish, maintain and enforce, a supervisory…
Read more