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November 10, 2023 at 11:44 AM
The online stock trading firm Webull was slapped with a $500,000 fine Thursday by Massachusetts regulators who said the firm had inadequate compliance staff — at times, only a single employee to handle compliance matters for hundreds of thousands of brokerage accounts.
While Webull paid out $30 million to sponsor the Brooklyn Nets of the National Basketball Association and the New York Liberty of the Women’s National Basketball Association, the brokerage didn’t hire a dedicated compliance team, according to charges filed by Masachusetts’ top securities regulator, William Galvin.
Those sponsorship deals helped Webull amass more than 6 million brokerage accounts, including more than 100,000 in the state of Massachusetts, since the company launched in 2018.
However, Webull didn’t have staff or supervisory procedures in place to field more than 40,000 communications received from customers in the state of Massachusetts over a four-year period, Galvin’s office alleged.
Webull agreed to settle the charges without admitting or denying any violation of the law. The firm declined to comment Thursday and has not addressed the settlement on its blog or social media.
