Decker & Co gets a slap on the wrist for failing to maintain required capital
Decker & Co, LLC has agreed to pay a fine of $35,000 as a part of a settlement with the Financial Industry Regulatory Authority (FINRA).
In December 2019, and again from April 2020 to June 2020, Decker conducted a securities business while it failed to maintain the required minimum net capital. As a result, Decker violated the Securities Exchange Act of 1934 (Exchange Act) § 15(c), Exchange Act Rule 15c3-1 promulgated thereunder, and FINRA Rules 4110(b) and 2010.
In December 2019, the firm cleared trades through a clearing firm and was subject to a minimum net capital requirement of $19,465. As of December 31, 2019, the firm had failed to accrue $152,117 in liabilities, resulting in a net capital deficiency of $57,519. The firm conducted a securities business on this date.
On April 10, 2020, the firm terminated its clearing arrangement, which caused the firm’s minimum net capital requirement to increase to $250,000. Between April 30, 2020, and June 30, 2020, the firm was net capital deficient by amounts ranging from $359,575 to $447,033. On October 28, 2020, the firm filed a notice with FINRA under Exchange Act Rule 17a-11 that it had engaged in securities business while below its required minimum net capital during this time period.
From December 2019 to June 2020, Decker failed to maintain books and records accurately reflecting the firm’s liabilities and net capital levels and filed inaccurate Financial and Operational Combined Uniform Single (FOCUS) reports. As a result, Decker violated Exchange Act § 17(a), Exchange Act Rules 17a-3 and 17a-5, and FINRA Rules 4511 and 2010.
From April 2020 to at least March 2022, the firm failed to file an application for approval of a material change in business operations to reflect that it would be chaperoning trades without a clearing firm, in violation of FINRA Rules 1017 and 2010.
Finally, the firm failed to conduct required independent testing of its anti-money laundering program for the years 2017 through 2020, in violation of FINRA Rules 3310(c) and 2010.
In addition to the fine, the firm has agreed to a censure.