NOTE: Stipulations of Fact and Consent to Penalty (SFC); Offers of Settlement (OS); and Letters of Acceptance Waiver, and Consent (AWC) are entered into by Respondents without admitting or denying the allegations, but consent is given to the described sanctions & to the entry of findings. Additionally, for AWCs, if FINRA has reason to believe a violation has occurred and the member or associated person does not dispute the violation, FINRA may prepare and request that the member or associated person execute a letter accepting a finding of violation, consenting to the imposition of sanctions, and agreeing to waive such member's or associated person's right to a hearing before a hearing panel, and any right of appeal to the National Adjudicatory Council, the SEC, and the courts, or to otherwise challenge the validity of the letter, if the letter is accepted. The letter shall describe the act or practice engaged in or omitted, the rule, regulation, or statutory provision violated, and the sanction or sanctions to be imposed.

Donnelly Penman & Partners and Charles Kirk Haggarty (Principal)
AWC/2009016347901

Despite the requirement that it monitor compliance with the requirements of the Bank Secrecy Act, 31 USC 5311, et seq., and the regulations promulgated thereunder, and despite a previous regulatory sanction by FINRA, the firm, acting through Haggarty, continued to fail to conduct and evidence an independent test of its AML program.

The firm failed to create a required report, which a principal or principals must submit to its senior management at least annually, detailing each member’s system of supervisory controls; a summary of test results to determine whether its supervisory procedures are reasonably designed with respect to the firm’s and its registered representatives’ and associated persons’ activities, to achieve compliance with applicable securities laws, regulations and rules; and significant identified exceptions and any additional or amended supervisory procedures created in response to the test results.

The firm failed to prepare and execute a Chief Executive Officer (CEO) certification confirming that the firm has processes in place to establish, maintain, review, test and modify written compliance policies and supervision procedures reasonably designed to achieve compliance with applicable FINRA rules, Municipal Securities Rulemaking Board (MSRB) rules and federal securities laws and regulations; and that the CEO has conducted one or more meetings with the chief compliance officer in the preceding 12 months to discuss such processes.

Donnelly Penman & Partners: Censured; Fined $10,000; Fined an additional $10,000 jt/sev with Haggarty

Charles Kirk Haggarty (PrincipalCensured; Fined $10,000 jt/sev with Donnelly Penman

Tags: AML