5. Suitability. Cases: 45 | Fines: $2.7 million

This is the second year in a row that suitability cases have been on the Eversheds top enforcement Issues list. The number of cases decreased 51% from 91 cases brought in 2018, while fines decreased 77% from $11.8 million reported in 2018. FINRA also ordered $17.2 million in restitution in suitability cases, compared with $11.6 million in 2018. (Photo: Shutterstock)
4. Municipal securities. Cases: 8 | Fines: $2.7 million

This is the first time municipal securities cases have been on top enforcement Issues list since 2013. (Photo: Shutterstock)
3. Misleading or inaccurate information. Cases: 28 | $3.3 million

This is the first time that misleading or inaccurate information cases made the list. The number of cases decreased 18% from the 34 cases brought in 2018, although the fines increased 83% from $1.8 million reported in 2018. (Photo: Shutterstock)
2. Exchange-Traded Funds/Products. Cases 13 | Fines: $3.5 million

This is the first time this category has made the list since 2012. The number of cases increased 30% from the 10 cases brought in 2018, while fines increased by 218% from $1.1 million reported in 2018. ETF/ETP cases were driven in large part by one case where FINRA fined a firm $2.9 million. (Photo: Shutterstock)
1. Anti-money laundering (AML). Cases: 12 | $17.4 million

AML tops the list for the fourth consecutive year. But the 2019 numbers are lower than in 2018, when FINRA reported 17 AML cases totaling $27.3 million in fines. AML maintained the top spot due in part to the largest single fine FINRA assessed in any case in 2019 ($15 million) against BNP Paribas. (Photo: Shutterstock)


(Related: FINRA’s Top Fine Categories in 2018)

Fines reported by the Financial Industry Regulatory in 2019 decreased 28% to $44 million, from $61 million 2018, according to Eversheds Sutherland’s annual look at disciplinary actions reported by the broker-dealer regulator.

FINRA “continues the year-over-year trend of reductions in fines from the record-setting year in 2016 when FINRA ordered $174 million in fines,” Eversheds reports. The law firm reviews FINRA’s monthly disciplinary reports, press releases and online database.

Along with the overall reduction in fines, the number of cases with very large fines also declined in 2019, with FINRA assessing nine “supersized” fines of $1 million or more, totaling $27.9 million.

In 2018, FINRA assessed 13 supersized fines, totaling $47 million.

Similarly, Eversheds reports that FINRA assessed just one fine of $5 million or more in 2019. In 2018, five cases resulted in such large fines.

FINRA reported 591 disciplinary actions in 2019, a decrease of 7% from the 638 disciplinary actions in 2018 and a decrease of 41% from the 1,007 cases FINRA reported in 2017.

The percentage of cases against just firms (as opposed to cases against individuals or jointly against both firms and individuals) declined to 18% from 25% during 2018, the report found.

The number of individuals barred or suspended and firms expelled also decreased in 2019 compared with 2018, with FINRA barring 198 individuals in 2019, a 6% decrease from the 211 reported in 2018.

Firms expelled by FINRA decreased from 4 in 2018 to 3 in 2019.

Finally, the number of individuals suspended decreased 4%, from 254 in 2018 to 245 in 2019.

“Last year, the amount of fines, restitution, and cases decreased from the previous year, appearing to indicate a kinder and gentler FINRA — at least temporarily,” said Eversheds partner Brian Rubin.

See the gallery above for the top fine categories for 2019, ranked by the total dollar amount of fines ordered.

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