Q: Any other noteworthy issues?
BR: During the first six months of 2016, FINRA reported 11 "supersized" fines of $1 million or more, four of which were "ginormous" fines of $5 million or more. FINRA also ordered $13.8 million in restitution during this time period. If restitution continues at a similar pace, the year-end total would be nearly $28 million, representing a 71% decrease from the total restitution reported by FINRA in 2015 ($96 million).
Q: What categories generated the heftiest fines?
BR: The top five categories for fines were variable annuities, due diligence, anti-money laundering (AML), trade reporting and notes/bonds.
Q: What should broker-dealers and individuals focus on going forward?
BR: These statistics bear out what we've been hearing from FINRA staff: We are in a whole new world. Firms and individuals will need to adjust their mindsets regarding fine levels in disciplinary cases. To try to avoid being the subject of one of these actions, firms should consider focusing on "nuts and bolts" issues like marketing and suitability of products, AML, trade reporting, and supervisory policies and procedures.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/securities-enforcement-attorney-ginormous-finra-fines-may-propel-2016-to-record-setting-year-300338904.html
SOURCE Sutherland Asbill & Brennan LLP