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November 18, 2016 at 03:56 AM
The Financial Industry Regulatory Authority (FINRA) fined Oppenheimer & Co. Inc. $1.575 million and ordered the firm to pay $1.85 million to customers for failing to report required information to FINRA, failing to produce documents in discovery to customers who filed arbitrations and for not applying applicable sales charge waivers to customers, according to the action.
“It’s important for firms to ensure their supervisory programs are designed to comply with FINRA reporting requirements, and that their procedures provide adequate direction to their employees to make required filings,” Brad Bennett, FINRA’s executive vice president and chief of enforcement, said in a statement. “FINRA uses this information to identify and initiate investigations of firms and associated persons that pose a risk to investors.”
FINRA found that over a span of several years, Oppenheimer failed to timely report to FINRA more than 350 required filings including securities-related regulatory findings, disciplinary actions taken by Oppenheimer against its employees, and settlements of securities-related arbitration and litigation claims.
In addition, FINRA found that between 2010 and 2013, Oppenheimer failed to produce relevant documents during discovery to seven arbitration claimants who alleged Oppenheimer failed to supervise former registered representative Mark Hotton. As part of its action, FINRA is ordering Oppenheimer to provide the seven claimants with copies of the respective documents that were not produced, and payments totaling more than $700,000.
FINRA also found that Oppenheimer failed to reasonably supervise the application of sales charge waivers to eligible mutual fund sales. The firm relied on its financial advisors to determine the applicability of sales charge waivers, but failed to maintain adequate written policies or procedures to assist financial advisors in making this determination. As a result of FINRA’s action, Oppenheimer has paid eligible customers $1.14 million in remediation to customers who qualified for, but did not receive, applicable mutual fund sales charge waivers.
SEC Charges Renewable Energy Company, CEO and Others With Defrauding Investors
The Securities and Exchange Commission filed fraud charges against four individuals and others who allegedly profited by defrauding investors in a cash-strapped California-based renewable energy company.
Patrick Carter, the founder and CEO of 808 Renewable Energy Corp. was charged along with the company, chief operating officer Peter Kirkbride, sales representatives Martin Kinchloe and Thomas Flowers, and three other firms: 808 Investments LLC, West Coast Commodities LLC, and T.A. Flowers LLC.
