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FINRA fines Raymond James broker-dealers $1.1 million for compliance failures

On Behalf of | Oct 27, 2022 | FINRA Compliance

Two broker-dealers affiliated with Raymond James Financial Inc. have been fined for alleged rule violations, according to InvestmentNews.

The Financial Industry Regulatory Authority announced the fines, totaling $1.1 million, in a letter of Acceptance, Waiver and Consent.

A penalty of $800,000 was levied against Raymond James Financial Services Inc. for what FINRA said was a failure to reasonably supervise two registered representatives who took part in a scheme to overcharge commissions to seven institutional customers, who they serviced as part of a team. The two representatives were a father and son team who worked at a branch office in the state of Washington.

It was determined that the firm, an independent-broker dealer, had not reasonably investigated the representatives even though their conduct raised red flags. The firm was found to be in violation of NASO Rule 3010(a) and FINRA Rules 3110(a) and 2010.

FINRA found separate violations by Raymond James Financial Services and Raymond James & Associates Inc., the broker-dealer for employee advisers. The authority said that from January 2012 to February 2020, they failed to have a qualified and registered principal authorize changes to the account name or designation on more than 7,500 equity orders, in violation of FINRA Rules 4515 and 2010. In this matter, a fine of $300,000 was imposed.

Raymond James was also ordered to pay approximately $49,000 in restitution to customers who were affected. Without admitting or denying the findings, the two firms agreed to the settlement.

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