MML Investors Services, LLC has agreed to pay a fine of $700,000 as a part of a settlement with the Financial Industry Regulatory Authority (FINRA).

From March 2017 through April 2020, MML’s supervisory system, including written supervisory procedures, was not reasonably designed to achieve compliance with the firm’s obligation to supervise consolidated reports. The firm failed to reasonably supervise the process of its representatives creating consolidated reports including the manual entry of account information using a third-party reporting system.

In addition, during the period November 2018 to January 2019 one of the firm’s representatives manually entered false brokerage account information into the consolidated reporting system for three related customers, failed to provide supporting documentation for the manual entries as required, and did not create draft reports for supervisory review, posting instead the falsified account information related to a fictitious account for customer viewing directly to the system.

Further, brokerage account information for MML accounts was automatically fed into the system so there was no reason to manually enter it. The firm failed to detect that the representative was using falsified data and fictitious accounts because it did not review manual account entries as required.

MML compensated the customers for damages related to the representative’s actions.

Beginning in April 2020, MML made improvements to its supervisory system to address these issues.

Therefore, the firm violated FINRA Rules 3110 and 2010.

On top of the $700,000 fine, the firm has agreed to a censure.

MML Investors Services, LLC is based in Springfield, Massachusetts and has been a FINRA member since 1982. It provides investment banking, brokerage, advisory, and other financial services. The firm employs approximately 7,100 registered representatives operating from over 1,300 branches.