Article: Merrill Lynch Fined for Supervisory Failures Leading to Ponzo Scheme

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Merrill Lynch Fined for Supervisory Failures Leading to Ponzo Scheme

Nicholas Guiliano

Securities Arbitration Attorneys, 20 June 2015

Bank of America subsidiary Merrill Lynch, Pierce, Fenner & Smith Inc. has been fined $1 million by the Financial Industry Regulatory Authority, or FINRA, for failure to supervise one of its stockbrokers at its branch office in San Antonio, Texas. FINRA announced the fine on Oct. 4.

Bruce Edward Hammonds, a registered representative with the firm, used a Merrill Lynch account to operate a Ponzi scheme, luring 11 people to invest more than $1 million in B&J Partnership, an entity he ran for over 10 months, according to information released by FINRA. Hammonds request to open a business account for B&J was approved by Merrill Lynch supervisors, who subsequently failed to monitor the funds that the investors deposited and Hammonds withdrew. He was fired by Merrill Lynch in June 2008.

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Article: UBS Fined $12M for System Failures Surrounding Nakes Short Selling

Article - Media

UBS Fined $12M for System Failures Surrounding Nakes Short Selling

Nicholas Guiliano

Securities Arbitration Attorneys, 20 June 2015

UBS Securities LLC was fined $12 million and censured by the Financial Industry Regulatory Authority, or FINRA, for widespread system deficiencies and a failure to supervise that led to tens of millions of improper short sales.

The firm violated federal securities laws and FINRA rules at various times from January 2005 through March 2010, with several violations continuing through the end of 2010. The violations included improperly excepting short sales from the rules and the improper inclusion of securities in short sales that should have been off limits.

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