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ARTICLE · 12 DECEMBER 2019

Firm Settles FINRA Charges For Short Interest Reporting Violations

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A firm settled FINRA charges for failure to comply with short interest reporting requirements, related supervisory failures concerning certain foreign-listed securities...

United StatesFinance and Banking
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A firm settled FINRA charges for failure to comply with short interest reporting requirements, related supervisory failures concerning certain foreign-listed securities, and violating FINRA Rule 4560 ("Short-Interest Reporting") and Rule 3110 ("Supervision"), respectively.

FINRA Rule 4560 obligates firms to maintain a record of total short positions in all customer and proprietary firm accounts in connection with all equity securities (subject to certain exceptions). Rule 4560 also obligates firms to regularly report such short interest information to FINRA.

According to the FINRA Letter of Acceptance, Waiver and Consent, the firm:

  • failed to report 3,129 short interest positions due to a system-related coding issue that excluded certain foreign-listed securities from the firm's short interest submissions; and

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