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December 18, 2020 at 05:33 PM
(Photo: ALM)
Three Cetera Financial Group broker-dealers have agreed to pay a total fine of $1 million to settle claims that their supervisory systems and procedures were deficient when handling securities transactions made by dually registered representatives, according to the Financial Industry Regulatory Authority.
Over a period of several years, the dually registered reps “managed more than $80 billion in customer assets across more than 47,000 accounts,” according to FINRA. The Cetera firms “were aware of the supervisory deficiencies” that were identified in Securities and Exchange Commission examinations in 2013, 2015 and 2017, FINRA alleged.
The advisors were registered both at Cetera-branded broker-dealers and at “unaffiliated or ‘outside’ registered investments advisors (RIAs),” the regulatory group said.
Without admitting or denying the allegations, Cetera Advisor Networks, Cetera Advisors and Cetera Financial Specialists recently signed a FINRA letter of acceptance, waiver, and consent and agreed to FINRA’s sanctions, which included a censure and an agreement that they would review and revise, as necessary, systems, policies and procedures related to the supervision of dually-registered reps’ securities transactions.
Cetera Advisor Networks will pay a $750,000 fine, while Cetera Advisors will pay $150,000; Cetera Financial Specialists is set to pay $100,000. FINRA signed the letter agreeing to the settlement Tuesday.
