May 28, 2024 – An AWC was issued in which the firm was censured, fined $325,000, and required to certify that it has remediated the issues identified in the AWC and implemented a reasonably designed supervisory system, including WSPs. 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 reasonably designed to detect possible instances of signature forgery or falsification. The findings stated that firm registered representatives electronically signed customer names on documents, including documents that were required books and records of the firm. The firm’s WSPs required representatives to obtain authentic customer signatures on firm documents. However, the firm’s WSPs did not include any procedure to supervise use of electronic signatures or provide reasonable guidance to supervisors on what they should look for in attempting to assess whether an electronic signature was genuine. As a result, the firm did not reasonably investigate certain red flags contained in the certificates of completion, such as instances where representatives sent a document from their work email address to an email address not recorded in the customer’s account information such as their personal email address, sent an authentication code to their own cell phone number, or instances where the representative and customer’s remote signatures were sent from the same IP address. The firm failed to detect that certain of its representatives sent documents requiring a customer’s electronic signature to their own personal and work email addresses, and corresponding authorization codes to their own phones, and then falsified or forged customer electronic signatures on firm documents. The falsifications and forgeries were not in furtherance of unauthorized activity, there was no customer harm, and no customer complained. (FINRA Case #2023079075201)
Harmed investors can call (954) 693-7577 or email [email protected] to discuss their legal options. All consultations are free and confidential. Most cases are handled on a contingency fee basis, meaning that clients are not obligated to pay attorney fees unless money is recovered on their behalf.