The Financial Industry Regulatory Authority (FINRA) has imposed a fine of $24 million against BofA Securities.
This action is a consequence of the firm’s alleged involvement in over
700 instances of spoofing and related supervisory failures within the US Treasury
secondary markets, spanning more than six years.
Spoofing involves placing deceptive orders to create
a false impression of market activity. According to a statement by the
regulator, BofA Securities utilized this tactic through two former traders in the
US Treasury secondary markets from October 2014 to February 2021. The firm
allegedly engaged in 717 instances of spoofing.
Bill St. Louis, the Executive Vice President and
Head of Enforcement at FINRA mentioned: “Spoofing undermines the
transparency and integrity of the markets by distorting the true nature of
supply and demand. This action sends a strong message that FINRA will
aggressively pursue firms that engage in spoofing, including cross-product
spoofing.”
During this period, BofA Securities failed to
establish and maintain a supervisory system capable of detecting spoofing
activities in the US Treasury markets. In November 2015, the company
implemented the system, but until mid-2019, it was insufficient. It was only designed to detect algorithmic spoofing and not manual manipulation by
traders.
BofA Securities has agreed to FINRA’s findings
without admitting or denying the charges. Last year, FINRA fined the company
$325,000 for allegedly publishing inaccurate monthly reports for order
execution
Execution
Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co
Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co
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The watchdog revealed that between January 2014 and
February 2022, BofA Securities inaccurately reported order execution statistics
for its two market centers, MLCO and MLIX. The company allegedly flouted the requirement to report separate
statistical information under Rule 605, leading to the publication
of combined reports for both centers.
Heightened Regulatory Scrutiny in Brokerage
Practices
In June, Credit Suisse came under scrutiny after FINRA imposed its US subsidiary a fine of $900,000 for lapses in regulatory
reporting. The violations involved late trades and inaccurate Trade Reporting and Compliance
Compliance
In finance, banking, investing, and insurance compliance refers to following the rules or orders set down by the government regulatory authority, either as providing a service or processing a transaction. Compliance concerning finance would also be a state of being following established guidelines or specifications. This designation can also encompass efforts to ensure that organizations are abiding by both industry regulations and government legislation. Understanding ComplianceCompliance is a
In finance, banking, investing, and insurance compliance refers to following the rules or orders set down by the government regulatory authority, either as providing a service or processing a transaction. Compliance concerning finance would also be a state of being following established guidelines or specifications. This designation can also encompass efforts to ensure that organizations are abiding by both industry regulations and government legislation. Understanding ComplianceCompliance is a
Read this Term
Engine reports from November 2015 to March 2023.
Early this year, FINRA imposed a penalty worth $3 million against Webull. It highlighted the firm’s oversight in onboarding options
traders and a lack of adequate supervisory systems to identify and address
customer complaints. This oversight resulted in the approval of approximately
9,000 unqualified traders, including over 2,500 customers under the age of 21
who lacked the requisite options trading experience.
The Financial Industry Regulatory Authority (FINRA) has imposed a fine of $24 million against BofA Securities.
This action is a consequence of the firm’s alleged involvement in over
700 instances of spoofing and related supervisory failures within the US Treasury
secondary markets, spanning more than six years.
Spoofing involves placing deceptive orders to create
a false impression of market activity. According to a statement by the
regulator, BofA Securities utilized this tactic through two former traders in the
US Treasury secondary markets from October 2014 to February 2021. The firm
allegedly engaged in 717 instances of spoofing.
Bill St. Louis, the Executive Vice President and
Head of Enforcement at FINRA mentioned: “Spoofing undermines the
transparency and integrity of the markets by distorting the true nature of
supply and demand. This action sends a strong message that FINRA will
aggressively pursue firms that engage in spoofing, including cross-product
spoofing.”
During this period, BofA Securities failed to
establish and maintain a supervisory system capable of detecting spoofing
activities in the US Treasury markets. In November 2015, the company
implemented the system, but until mid-2019, it was insufficient. It was only designed to detect algorithmic spoofing and not manual manipulation by
traders.
BofA Securities has agreed to FINRA’s findings
without admitting or denying the charges. Last year, FINRA fined the company
$325,000 for allegedly publishing inaccurate monthly reports for order
execution
Execution
Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co
Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co
Read this Term.
The watchdog revealed that between January 2014 and
February 2022, BofA Securities inaccurately reported order execution statistics
for its two market centers, MLCO and MLIX. The company allegedly flouted the requirement to report separate
statistical information under Rule 605, leading to the publication
of combined reports for both centers.
Heightened Regulatory Scrutiny in Brokerage
Practices
In June, Credit Suisse came under scrutiny after FINRA imposed its US subsidiary a fine of $900,000 for lapses in regulatory
reporting. The violations involved late trades and inaccurate Trade Reporting and Compliance
Compliance
In finance, banking, investing, and insurance compliance refers to following the rules or orders set down by the government regulatory authority, either as providing a service or processing a transaction. Compliance concerning finance would also be a state of being following established guidelines or specifications. This designation can also encompass efforts to ensure that organizations are abiding by both industry regulations and government legislation. Understanding ComplianceCompliance is a
In finance, banking, investing, and insurance compliance refers to following the rules or orders set down by the government regulatory authority, either as providing a service or processing a transaction. Compliance concerning finance would also be a state of being following established guidelines or specifications. This designation can also encompass efforts to ensure that organizations are abiding by both industry regulations and government legislation. Understanding ComplianceCompliance is a
Read this Term
Engine reports from November 2015 to March 2023.
Early this year, FINRA imposed a penalty worth $3 million against Webull. It highlighted the firm’s oversight in onboarding options
traders and a lack of adequate supervisory systems to identify and address
customer complaints. This oversight resulted in the approval of approximately
9,000 unqualified traders, including over 2,500 customers under the age of 21
who lacked the requisite options trading experience.