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September 02, 2022 at 04:22 PM
What You Need to Know
- Baird was ordered by FINRA to pay about $416,000 including a fine, restitution and interest.
- The BD charged a minimum commission of $100 even on small stock trades, FINRA says.
- The commissions Baird charged ranged from over 5% to 93% of the transactions' principal value.
The Financial Industry Regulatory Authority has ordered Robert W. Baird & Co. to pay a total of $416,481 plus interest over allegations that the firm overcharged its clients on thousands of equity transactions for more than one year.
Without admitting or denying the findings of FINRA’s investigation, Christa Graverson, Baird’s chief compliance officer, signed a FINRA acceptance, waiver and consent letter on Aug. 15 in which the firm consented to the imposition of a censure, a $150,000 fine, and restitution of $266,481 plus interest over its actions. FINRA signed the letter on Wednesday.
Baird did not immediately respond to a request for comment on Friday.
From June 2019 through December 2020, Baird’s published commission schedule had a minimum commission of $100 on equity transactions that FINRA said resulted in an “unfair commission being charged on 7,277 equity transactions.”
Baird also failed to establish and maintain a supervisory system “reasonably designed to achieve compliance with FINRA Rule 2121,” according to FINRA.
During the period in question, Baird used a published commission schedule under which the firm charged commissions on “low-principal transactions that were not fair and reasonable,” FINRA said in the AWC letter.
For all equity transactions, Baird imposed a minimum commission of $100 as well as a handling fee, according to FINRA.
