FINRA imposes $850k fine on UBS Financial Services
UBS Financial Services Inc has agreed to pay a fine of $850,000 as a part of a settlement with the Financial Industry Regulatory Authority (FINRA).
From at least September 2010 to July 2021, UBS failed to establish and maintain a supervisory system reasonably designed to achieve compliance with the firm’s obligation to monitor transmittals of customer funds to third parties and to respond reasonably to red flags of private securities transactions.
During this period, UBS failed to detect that a registered representative, who was acting outside the scope of his employment with the firm, sold to his UBS customers securities that were offered by a third party. Some of the registered representative’s customers invested approximately $1.8 million through direct wire transfers from the customers’ UBS accounts to the third party.
Therefore, UBS violated NASD Rules 3010 and 3012 and FINRA Rules 3110 and 2010.
On top of the $850,000 fine, the firm has agreed to a censure.