Foreign Collusion, Naked Shorting (Counterfeiting) & Money Laundering — All Illicit Wealth
Merrimac Corporate Securities, Inc. Fined by FINRA
17 July 2019
The Securities and Exchange Commission (SEC) issued a
decision in which the firm was suspended from FINRA® membership in all
capacities for 30 business days, suspended from receiving and liquidating
penny stocks for one year, fined $225,000 and required to retain an expert
to evaluate and approve its written supervisory procedures (WSPs).
Chat room messages are ‘smoking gun’ in $25 million Merrill CFTC spoofing penalty
Todd Ehret
Reuters, 17 July 2019
The U.S. Commodities Futures Trading Commission (CFTC) last month chalked up another impressive settlement over the market manipulation tactic known as “spoofing.” The $25 million penalty for Merrill Lynch Commodities in the case is the second largest related to spoofing.
Like many of the prior cases, where the firms cooperated with the investigations and were given credit for doing so, the proverbial “smoking gun” in the case was the record of online chat rooms where traders discussed markets, prices, and their strategies and actions.
Western International Securities, Inc. Fined by FINRA
16 July 2019
An AWC was issued in which the firm was censured, fined $75,000 and required to provide remediation to eligible customers who qualified for, but did not receive, the applicable mutual fund sales charge waivers. As part of this settlement, the firm agrees to pay restitution to eligible customers, which is estimated to total $375,000 (i.e., the amount eligible customers were overcharged, inclusive of interest).
Merrill Lynch Commodities receives $25m fine for spoofing and market manipulation (15 July 2019)
Jennie Clarke
Behavox, 15 July 2019
Merrill Lynch Commodities Inc has received a $25m charge from the US Commodity Futures Trading Commission (CFTC) for spoofing, manipulation and attempted manipulation, with respect to certain precious metals futures.
The CFTC found that Merrill Lynch Commodities traders placed orders to buy and sell precious metals futures contracts with the intent to cancel their orders before execution. The traders employed a specific spoofing strategy in which they would place a small bid or offer with the intent to execute that order. Prior to the execution of that order, they would place a larger order on the opposite side of the same market with the intent to cancel that order before execution. This manipulated market prices and created artificial and fluctuating prices.
Bank Of America, Morgan Stanley Again Accused Of Spoofing
Rachel Graf
Law360, 12 July 2019
Morgan Stanley & Co. LLC, Bank of America Corp. and its subsidiary Merrill Lynch Commodities Inc. engaged in spoofing in an effort to manipulate precious metals futures, according to a proposed class action filed Friday in New York federal court.
Three New York investors claim the banks, two former Merrill Lynch traders and 18 unnamed individual defendants manipulated gold, silver, platinum and palladium futures through a spoofing scheme in which they placed buy or sell orders that they intended to cancel. The practice simulates supply or demand, allegedly allowing the banks to profit from the swings in prices.
Larry Smith
Smith On Stocks, 11 July 2019
In this report, I contrast the risk and reward of shorting versus buying stocks. When you unravel the economics and risk/ reward of shorting, it is clear to me that this is a highly risky, low return strategy. As argued in this report, I see shorting as a losers game if employed consistently over time as opposed to buying stocks which is a winners game. I see shorting as a niche strategy that is applicable on a short term trading basis for a very limited number of stock trades. I think you will agree with me as I go through the major risk and reward elements of shorting.
BNP Paribas Securities Corp. Fined by FINRA
11 July 2019
An AWC was issued in which the firm was censured and fined $100,000. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to report and failed to timely report to the FINRA/Nasdaq Trade Reporting Facility® (FNTRF) transactions effected pursuant to the exercise of an overthe-counter (OTC) option that required a special trade report modifier.
Clearpool Execution Services, LLC Fined by FINRA
10 July 2019
An AWC was issued in which the firm was censured and fined $473,000, of which $43,000 is payable to FINRA. The remaining balance is to be paid to other selfregulatory organizations in related matters. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to establish and maintain a system that was reasonably designed to achieve compliance with applicable securities laws and regulations, and applicable FINRA rules.
Aegis Capital Corp. Fined by FINRA
10 July 2019
An AWC was issued in which the firm was censured and fined $93,125. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that while participating in public offerings that were subject to FINRA Rule 5110, it failed to file certain documents specified in FINRA Rule 5110(b)(5) with FINRA after it had filed such documents with the SEC. The findings stated that to date, these documents have not been filed with FINRA.
Traderfield Securities Inc. Fined by FINRA
9 July 2019
An AWC was issued in which the firm was fined $5,000. Without admitting or denying the findings, the firm consented to the sanction and to the entry of findings that it failed to have a system of supervisory control procedures that tested and verified that its supervisory procedures were reasonably designed to achieve compliance with applicable securities laws and regulations and FINRA rules.
8 July 2019
An AWC was issued in which the firm was censured and fined $15,000. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it had fail-to-deliver positions at a registered clearing agency and did not close out the fails by purchasing or borrowing securities of like kind or quantity within the required timeframe.
Citigroup Global Markets Inc. Fined by FINRA
8 July 2019
An AWC was issued in which the firm was censured and fined $55,000. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to report reportable options positions to the large options position reporting (LOPR) system due to a programming error in connection with accounts acting in-concert, and failed to report proprietary positions as acting-in-concert, because of a design flaw in its reporting logic. The findings stated that the firm reported positions to the LOPR in the wrong format and with an incorrect effective date.
Planmember Securities Corporation Fined by FINRA
3 July 2019
An AWC was issued in which the firm was censured and fined $90,000. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it had no WSPs or reasonable supervisory system for the surveillance of rates of variable annuity exchanges. The findings stated that the firm purported to use a spreadsheet prepared each month that summarized all variable annuity transactions to surveil rates of variable annuity exchanges.
CV Brokerage, Inc Fined by FINRA
2 July 2019
A Letter of Acceptance, Waiver and Consent (AWC) was issued in which the firm was censured and fined $100,000. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to establish and maintain a supervisory system and failed to establish, maintain and enforce WSPs, reasonably designed to achieve compliance with applicable FINRA rules regarding the participation of firm registered representatives in private securities transactions. The findings stated that a representative of the firm participated in multiple private securities transactions, at least two of which are known to have involved firm customers. Among others, the representative formed an investment fund that was managed by her registered investment advisory firm.
Larry Smith
Smith On Stocks, 1 July 2019
ost investors when they buy a publicly traded stock believe that they own a part of some company. They think that somewhere there is a stock certificate or some indication of ownership that has their name on it, but this is not the case. When you buy a “stock” you are actually purchasing a security that affords certain entitlement rights related to registered stock which actual owners hold. The registered shares of a private company are directly owned by shareholders. In contrast, the registered shares of nearly all publicly traded equities are owned by Cede & Co., which is the nominee of the Depository Trust Company (DTC). (A nominee is a company whose name is given as having title to a stock, but does not receive the financial benefits of ownership.) Cede is a subsidiary of the Depository Trust Company (DTC) which is a subsidiary of the Depository Trust and Clearing Corporation (DTCC) and the DTCC is a private company owned by elite Wall Street firms and money center banks. If you need background or a refresher on DTC and DTCC, click on this link. Effectively, elite Wall Street firms and money center banks, not institutions and individual investors, own almost all of the registered shares of publicly traded companies in the US.
THE DOLLAR HAS NO INTRINSIC VALUE : DO YOUR ASSETS?
