Firm Settles FINRA Charges For MSRB Reporting Violations Involving SHORT System

A firm settled FINRA charges for reporting violations involving the MSRB's Short-Term Obligation Rate Transparency ("SHORT") System.

In a Letter of Acceptance, Waiver and Consent, FINRA found that the firm failed to report to the SHORT System a minimum denomination for approximately 1,660 submissions, and inaccurately reported the maximum interest rate for approximately 1,300 submissions. With regard to the minimum denomination reporting failures, FINRA stated that the firm's reporting system "did not require the entry of the minimum denomination field." When transmitting data to the MSRB's Electronic Municipal Market Access (or "EMMA") System, FINRA found that the firm's reporting system would (i) populate the minimum denomination field with a zero instead of rejecting the report as incomplete and (ii) use the auction's interest rate instead of the security's maximum interest rate. As a result, FINRA found that the firm violated MSRB Rule G-34 ("CUSIP Numbers,