FINRA fines Fortrend Securities for alleged rule violations
Fortrend Securities, Inc has agreed to pay a fine of $30,000 as a part of a settlement with the Financial Industry Regulatory Authority (FINRA).
From June 30, 2020, to the present, Fortrend Securities willfully failed to comply with Form CRS requirements. The firm failed to timely file and deliver its Form CRS to retail investors.
Form CRS provides customers with information about the types of services the firm offers; the fees, costs, conflicts of interest, and required standard of conduct associated with those services; whether the firm and its investment professionals have reportable legal or disciplinary history; and how to get more information about the firm. Form CRS also includes required “conversation starters” to help begin a discussion with a broker- dealer about the relationship, including their services, fees, costs, conflicts, and disciplinary information.
When the firm belatedly filed and delivered its Form CRS, it contained deficiencies, including disclosing the wrong clearing firm and associated fees and charges, and omitting other required information.
As a result, Fortrend Securities willfully violated Section 17(a)(1) of the Securities Exchange Act of 1934 and Exchange Act Rule 17a-14, and violated FINRA Rule 2010.
In addition, Fortrend Securities failed to establish and maintain a supervisory system, including written supervisory procedures (WSPs), reasonably designed to achieve compliance with the firm’s Form CRS obligations, in violation of FINRA Rules 3110 and 2010.
Fortrend Securities agreed to a censure on top of the fine of $30,000. The firm is also required to certify remediation of the issues.
Fortrend Securities, Inc. has been a FINRA member since 1993 and has two registered representatives. The firm is headquartered in Melbourne, Australia along with its Australian affiliate, Fortrend Securities Pty Ltd. Fortrend Securities’ business primarily consists of introducing U.S. equity transactions, on behalf of Australian customers, to its U.S.-based clearing firm on a fully disclosed basis.
