Firm Settles FINRA Charges For AML Program Violations – Finance and Banking

A firm settled FINRA charges for failure to
establish and implement AML policies and procedures.

In a Letter of Acceptance, Waiver and Consent (“AWC”),
FINRA stated that “following a change in majority ownership,
the firm’s business model shifted, and it began to service
high-net worth international customers, many of whom were citizens
or residents of jurisdictions that posed a heightened risk of money
laundering or were considered bank secrecy havens.” FINRA
found that, from May 2018 to December 2019, the firm failed to (i)
establish and implement a written AML program reasonably designed
to detect and report suspicious activity tailored to the firm’s
new higher-risk business model, (ii) conduct a reasonable and
independent AML test for the firm’s retail securities business
and (iii) obtain the signature of a principal at the firm
evidencing supervisory review and approval of the opening of
customer accounts.

FINRA charged the firm with violations of FINRA Rules 3110 (“Supervision”), 2010 (“Standards of Commercial Honor
and Principles of Trade”) and 4512 (“Customer Account
Information”).

To settle the charges, the firm agreed to (i) a censure, (ii) a
$20,000 fine, and (iii) within 120 days of the AWC being accepted,
certifying to FINRA in writing that the firm has developed and
implemented a written AML program reasonably designed to achieve
and monitor its compliance with the requirements of the Bank
Secrecy Act and its implementing regulations.

Primary Sources

1. FINRA AWC: BLV Securities

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