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ARTICLE · 04 DECEMBER 2020

Firm Settles FINRA Charges For Electronic Correspondence Failures

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A firm settled FINRA charges for failing to journal approximately 6 million emails on its correspondence review platform.

United StatesFinance and Banking
Hogan Lovells Cadwalader
Hogan Lovells Cadwalader
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A firm settled FINRA charges for failing to journal approximately 6 million emails to its correspondence review platform. FINRA stated that this failure affected more than three quarters of the firm's employees who were subject to supervisory review.

In a Letter of Acceptance, Waiver and Consent, FINRA found that following an email server switch in January 2014, the firm did not conduct an initial test to ensure that the existing process of journaling employee emails was compatible with the new server. Further, FINRA found that the firm did not monitor for irregularities in terms of the volume of emails ingested into the review platform.

After identifying the electronic correspondence failure in January 2019, the firm filed a Rule 4530 disclosure report.

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