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ARTICLE · 06 JUNE 2020

Firm Fined For Operating Without Sufficient Net Capital

Hogan Lovells Cadwalader
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A broker-dealer settled FINRA charges for operating without sufficient net capital.

United StatesFinance and Banking
Hogan Lovells Cadwalader
Hogan Lovells Cadwalader
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A broker-dealer settled FINRA charges for operating without sufficient net capital. The firm was also cited for related reporting failures, including filing inaccurate Financial and Operational Combined Uniform Single ("FOCUS") reports.

FINRA alleged that the broker-dealer's operation without sufficient net capital was in violation of Exchange Act Rule 15c3-1 ("Net Capital Requirements") and FINRA Rule 4110(b) ("Capital Compliance"). Furthermore, FINRA alleged that the broker-dealer's filing of inaccurate FOCUS reports and failure to maintain books and records with accurate net capital calculations was in violation of Exchange Act Rule 17a-3 ("Broker Records") and Rule 17a-5 ("Broker Reports"), as well as FINRA Rule 4511 ("General Requirements"), among other securities regulations.

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