FINRA Slaps $900k Penalty on Credit Suisse's US Subsidiary

<p>The
Financial Industry Regulatory Authority (FINRA) has slammed a censure and fine
of $900,000 on Credit Suisse for reporting more than 9,000 late trades and
hundreds of thousands of inaccurate TRACE reports. The newest ruling covers the
period from November 2015 to March 2023.</p><p>FINRA Imposes Penalty on
Credit Suisse</p><p>According
to FINRA's documents, the penalty was imposed on Credit Suisse Securities
(USA), a subsidiary of the Swiss multinational investment bank and financial
services company Credit Suisse. This followed the submission of a Letter of
Acceptance, Waiver, and Consent (AWC) by the company to FINRA, admitting to a
series of violations of the agency's rules.</p><p>These
violations spanned from late and inaccurate trade reports to improper internal
late error rate targets, which did not effectively address a persistent pattern
of late trade reporting. This comprehensive set of violations relates mainly to
the firm's dealings with the Trade Reporting and Compliance Engine (TRACE).
TRACE system aims to promote transparency in the US over-the-counter securities
market.</p><p>"The
firm's late and inaccurate TRACE reports violated FINRA Rules 6730 and 2010,"
FINRA commented in the statement.</p><p>Furthermore,
the firm neglected to provide timely notice for roughly 190 new issue offerings
in TRACE-reportable securities. The supervisory system established by Credit
Suisse to review the accuracy and timeliness of TRACE reporting was deemed
to be unreasonable.</p><p>Due to
these violations, Credit Suisse is now required to pay a fine of $900,000 and
has received censure from FINRA. The penalties will come into effect upon
FINRA's formal decision. As a silver lining for Credit Suisse, FINRA will not
pursue any future actions against the firm for the same findings stated in the
AWC provided that the agreement is accepted. This stipulation will prevent any
duplication of penalties for the financial services giant.</p><p>Long List of FINRA's Fines
in 2023</p><p>Credit
Suisse Securities (USA) is not the only significant financial entity FINRA
fined recently. As Finance Magnates reported in April, <a href="https://www.financemagnates.com/institutional-forex/goldman-sachs-fined-3m-for-mismarking-60m-short-sale-orders/" target="_blank" rel="follow">Goldman Sachs was fined
$3 million</a> for mismarking approximately 60 million short sales orders as 'long'
orders between October 2015 and April 2018.</p><p>A month
earlier, the regulatory body slammed <a href="https://www.financemagnates.com/forex/finra-hits-webull-with-3m-fine-for-permitting-unqualified-options-traders/" target="_blank" rel="follow">a fine of $3 million on the security broker,
Webull</a>, for onboarding unqualified options traders between December 2019 and
July 2021. <a href="https://www.financemagnates.com/institutional-forex/finra-hits-sagetrader-with-new-100k-fine-for-aml-failure/" target="_blank" rel="follow">SageTrader</a>, another security broker from California, was hit with a censure
order and a fine of $100,000 for failing to establish and implement anti-money
laundering procedures.</p><p>In February, UBS Securities, located in New York, <a href="https://www.financemagnates.com/institutional-forex/finra-slams-475k-fine-on-ubs-securitiessecond-in-4-months/" target="_blank" rel="follow">had to pay $475,000</a> for publishing 'inaccurate'
monthly statistics on the execution of its covered orders between September
2015 and January 2019. In the meantime, <a href="https://www.financemagnates.com/institutional-forex/finra-fines-bgc-financial-175k-for-trace-reporting-errors/" target="_blank" rel="follow">BGC Financial was fined $175,000</a> for
failing to properly report the <a href="https://www.financemagnates.com/terms/e/execution/">execution</a> time of over 3.5 million US Treasury
Securities transactions to TRACE reporting.</p><p>The
self-regulatory body <a href="https://www.financemagnates.com/forex/news-nuggets-5-april-bus-offers-interest-finra-warns-against-phishing/" target="_blank" rel="follow">warned against phishing attempts</a> targeting member firms in
a separate update. Impersonators of FINRA were sending emails to FINRA members,
luring them to click on <a href="https://www.financemagnates.com/terms/p/phishing/">phishing</a> links.</p>

This article was written by Damian Chmiel at www.financemagnates.com.