Articles Tagged with Failure to Supervise

FINRA wants a member firm to enforce its written supervisory procedures.  And FINRA wants a member firm to recommend securities that fit within the customer’s investment objectives.  And certainly FINRA wants a member firm to avoid falsification of business records.  So what happens when a member firm doesn’t quite live up to FINRA’s expectations?  Let’s play the over / under game and try to guess the size of the FINRA sanction when a member engages in the following misconduct:

• Failure to enforce WSPs governing the sale of high-risk mutual funds subject to significant volatility
• Failure to reallocate portfolios to reduce risk or otherwise update investment objectives to correspond with the assumption of additional risk