FINRA imposes $500k fine on Oppenheimer & Co
Oppenheimer & Co. Inc. has agreed to pay a fine of $500,000 as a part of a settlement with the Financial Industry Regulatory Authority (FINRA).
Between 2012 and 2017, Oppenheimer failed to reasonably supervise transactions that the firm’s registered representatives placed directly with product sponsors on behalf of firm customers (i.e., direct business transactions or held away securities transactions) in violation of NASD Rule 3010 and FINRA Rules 3110 and 2010.
Oppenheimer did not take steps reasonably designed to ensure that direct business transactions appeared on the firm’s daily trade blotter, causing the firm to fail to run approximately 490,000 transactions (including dividend reinvestments) for over 14,000 customers through exception reports used to identify potential sales practice violations, including potentially unsuitable transactions.
Oppenheimer also failed to ensure that it collected information for customers’ investment profiles (e.g., customers’ ages, investment time horizons and liquidity needs) that was relevant for making certain suitability determinations.
As a result of the foregoing, Oppenheimer violated Section 17(a) of the Securities Exchange Act of 1934, Exchange Act Rule 17a-3, NASD Rule 3010, and FINRA Rules 3110, 4511 and 2010.
In addition to the $500,000 fine, the firm has agreed to a censure.