FINRA ramps up anti-money laundering compliance actions at securities firms

By Christine Duhaime | August 18th, 2014

The Financial Industry Regulatory Authority (“FINRA“) announced today that it filed a ¬†Complaint against Wedbush Securities Inc. for alleged egregious and systemic anti-money laundering compliance infractions. According to the Wall Street Journal’s Risk & Compliance Journal, FINRA has made enforcement of securities anti-money laundering a priority. According to securities firms in Toronto, so have Canadian securities regulators.

Wedbush is one of the largest independent securities brokerage firms in the US.

According to the Complaint, Wedbush allegedly failed to develop and implement written anti-money laundering policies, procedures and internal controls that were risk-based to its market-access business and that could achieve compliance with the Bank Secrecy Act.

Apparently, it also failed to investigate suspicious activity in financial transactions or to file many SARs as and when required.

According to the Complaint, no one appears to have been in charge of the firm’s AML compliance function. That function apparently was delegated to an AML officer and a Senior VP of Correspondent Services who allegedly was not adequately trained on AML and whose department was understaffed to perform the AML function. This latter person allegedly sub-delegated the AML function to another untrained person who then delegated the task to a fourth untrained analyst.

You can read the Complaint here.

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