A broker-dealer settled FINRA charges for failing to take reasonable measures to prevent fraudulent wire transfers from customers' accounts.
FINRA alleged that two of its registered representatives stole customer funds by redirecting wire transfers and checks from customers' accounts. FINRA charged the broker-dealer with failing to take reasonable measures that might have prevented these fraudulent transfers. Specifically, the broker-dealer failed to (i) enforce policies and procedures for third-party payments or (ii) respond to red flags in a reasonable manner. FINRA noted that the representatives acted independently of one another.
To settle the charges, the broker-dealer agreed to a (i) censure and (ii) fine of $400,000.
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