SEC Fines Wedbush $2.4 Million for Market Access Violations as FINRA Complaint Awaits

Attorney Advising Disclaimer

Los Angeles-based Wedbush Securities settled a pending SEC case for $2.44 million for violating the industry's market access rule by failing to have adequate risk prevention controls in place before providing customers access to the market, including some firms with thousands of virtually anonymous overseas traders.

In settling the case, Wedbush admitted wrongdoing while Wedbush former executive vice president Jeffrey Bell and senior VP Christina Fillhart consented to the findings, agreeing to penalties in excess of $85,000, which includes disgorgment and prejudgment interest.

According to the SEC's press release, broker-dealer Wedbush committed "other violations" in addition to the publicized failure-to-impose-safeguards misconduct. Pursuant to the terms of the Wedbush settlement, the SEC press release did not reveal the identity of those "other violations," save for Wedbush's failure to implement proper risk controls.

FINRA, meanwhile, filed an August 2014 complaint against Wedbush Securities in which regulators alleged systematic supervisory and anti-money laundering (AML) violations related to sponsored and direct market access given to broker-dealers and non registered market participants.

The August complaint stated that Wedbush's AML and control systems violations took place from 2008 through 2013 and resulted in manipulative trades. FINRA at the time stated that Wedbush's failure to correct this series of "red flag" misconduct only exacerbated its noncompliance with federal securities laws, and, as such, constituted "willful" violation of both FINRA rules and the Securities Exchange Act of 1934.

If you have invested with LA-based Wedbush Securities or with any firm whose deficient or non-existent supervisory procedures, anti-money laundering provisions or other risk control measures have led to dangerous or manipulative trades, and such "red flag" misconduct has proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.

News: SEC Fines Wedbush $2.4M in Market Access Case; FINRA Complaint on Deck (ThinkAdvisor)

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