ARTICLE
26 February 2021

Firm Settles FINRA Charges For Failing To Safeguard Nonpublic Customer Information

CW
Cadwalader, Wickersham & Taft LLP

Contributor

Cadwalader, established in 1792, serves a diverse client base, including many of the world's leading financial institutions, funds and corporations. With offices in the United States and Europe, Cadwalader offers legal representation in antitrust, banking, corporate finance, corporate governance, executive compensation, financial restructuring, intellectual property, litigation, mergers and acquisitions, private equity, private wealth, real estate, regulation, securitization, structured finance, tax and white collar defense.
A firm settled FINRA charges for introducing representatives the firm was recruiting to a third-party vendor so as to create new customer accounts using customer nonpublic personal information
United States Finance and Banking

A firm settled FINRA charges for introducing representatives the firm was recruiting to a third-party vendor so as to create new customer accounts using customer nonpublic personal information, in violation of the privacy policies of the representatives' previous employers.

In the Letter of Acceptance, Waiver and Consent, FINRA stated that the firm knew the recruited representatives were not authorized to disclose customer nonpublic personal information to a non-affiliated third party, and that in doing so, the firm caused violations of Regulation S-P ("Privacy of Consumer Financial Information and Safeguarding Personal Information"). In addition, FINRA found the firm violated FINRA Rule 2010 ("Standards of Commercial Honor and Principles of Trade").

To settle the charges, the firm agreed to (i) a censure and (ii) a $125,000 fine.

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