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.
Centrade failed to implement
a reasonably designed
AML compliance program. The firm acted in
contravention of
AML requirements and its own procedures by failing to adequately
monitor for, detect
and investigate suspicious transactions notwithstanding multiple
red flags presented
by the trading in a customer’s account. In most instances,
suspicious activity related to one or more of the red flag
categories identified in the firm’s
AML compliance procedures, including
substantial fluctuations in
the customer’s account
value during the period in which the account was maintained at the
firm;
unexplained
and extensive wire activity, including a large number of
third-party incoming wires (some
of which originated from international banks); and
a wire transfer
from the customer’s
account for $39,000 sent to a country identified as a known
money-laundering risk and
bank-secrecy haven.
Centrade Securities Corp.: Censure; Fined $15,000 (lower fine imposed in consideration of "firm's revenues and financial resources"
Puritan Securities, Inc. later known as First Union Securities, Inc AWC/201002087520/January 2012
The Firmt
failed to implement a
reasonably compliant Anti-Money Laundering Compliance Program
(AMLCP).
The firm failed
to ensure that its registered
representatives received AML
training,
to ensure that new account files contained
evidence that the firm had
verified clients’ identities,
to conduct an independent
test of its AMLCP, and
to maintain its required
minimum net capital while
conducting a securities business.
The findings also included that
the firm’s procedures
required its designated principal to conduct inspections of the
firm’s Office of Supervisory
Jurisdiction (OSJ) each year and of its branch locations every two
years. The procedures also
required annual compliance meetings with registered persons. For
almost two years, the
designated principal did not ensure that the firm held an annual
compliance meeting and
the principal did not perform any inspections of the firm’s OSJ or
branch offices during that
time period.
Puritan Securities, Inc. later known as First Union Securities, Inc: Censured; Fined $15,000