The latest regulatory, disciplinary and criminal actions.
Enforcement
SEC to Consider New Rules for Leveraged and Inverse ETFs: Gensler
SEC Chief Gary Gensler said he has instructed staff to consider potential rule proposals to address risks associated with complex exchange-traded products.
Former Million-Dollar Merrill Broker Barred For Not Cooperating in Covid Relief Loan Probe
Scott G. Madison, a 19-year industry veteran, was discharged from Merrill in February after the firm investigated if he had improperly obtained pandemic relief funds meant for small businesses.
Fired Merrill Broker Absconded with Client Info in a Duffel Bag: Finra
Giordan Marc Zaro, who had already been expelled from Merrill for sending confidential information to a personal email address, also attempted to lift customer account data, the regulator said.
SEC Approves Finra’s Deposit Requirement Rule for High-Risk Firms
But broker-dealers and brokers engaged in misconduct will often uncover ways, despite the new rule, to avoid the regulators’ grasp, a former enforcement lawyer predicted.
Finra Suspends Ex-Merrill Rep Who Sought Covid-Relief Loan for Ersatz Business
The ex-Merrill representative falsely claimed on an application that she had earned $35,000 from renting out a room in her home, although she had not actually listed the property during that time, Finra said.
SEC Settles with 27 Firms Over Form CRS Lapses
The Commission said 21 investment advisors and 6 broker-dealers had failed to timely file or properly deliver Customer Relationship Summary forms as required under Regulation Best Interest.
Massachusetts Charges Schwab for Allowing Ex-RIA to Collect Fees After Licensed Lapsed
The state’s regulator brought charges against Schwab over “unethical and deceptive” practices that allegedly allowed an ex-advisor to collect at least $125,000 in fees from Schwab customers after his registration lapsed in 2014.
SEC Orders UBS to Pay $8 Million Over Brokers’ Sales of Volatility-Linked ETFs
Brokers had “flawed understanding” of the product and improperly guided clients to hold the ETFs, which are meant for short-term trading, according to a settlement announced Monday.
Finra Slams Robinhood with Record $70 Million Settlement over Supervisory Failures
The regulator said the penalties reflected the “widespread and significant harm” suffered by the commission-free trading app’s customers due to supervisory issues and trading outages.
Cetera to Pay $125K for Customer Privacy Issues Tied to Recruiting
The fine and censure agreed to by Cetera Advisor Networks mirrored previous sanctions against Securities America and Kestra Investment Services over broker recruits who shared client details with a third party vendor.
Finra Fines Climbed 44%; Exec Pay Stays Flat
CEO and President Robert Cook’s total pay dipped slightly to $3.12 million in the pandemic year while the regulator also said it collected $17.5 million more in fines and posted a net profit of $19.8 million
