The Financial Industry Regulatory Authority (Finra) fined the Wells Fargo services to purify 275,000 dollars and released the blame after finding the company failed to maintain an appropriate supervisory system to prevent unregistered municipal consultative activity.
Between June 2019 and November 2024, Vienna says that Wales Vargo did not have a system, including written supervisory measures, which were reasonably designed to comply with Article 15 B (1) (1) (B) of the Securities Exchange Act of 1934.
This ruling is prohibited that the intermediary provide investment advice to municipal entities without registration as a municipal advisor.
Finra found that although the bank’s procedures prevent employees from advising municipal customers regarding investment revenues from municipal securities, it failed to determine what constitutes this advice clearly.
The company is also said to lack operations to determine whether municipal account deposits are bond returns, and it has no effective controls to detect or prevent unimaginable consulting activity.
The organizer said that the reliance of Wales Fargo on customer agreements and disclosing the end of the year to alleviate the risks was insufficient, because the warnings were not prominent enough.
The company, which employs more than 18,000 actor registered in 5,000 branches, updated its supervisory framework in November 2024.
By violating the Board of Directors of the municipal securities rules (MSRB) G-27, in addition to the Finra 3110 and 2010 rules, Wales Fargo failed to “monitor high standards for commercial honor and fair trade principles.”
The bank approved the settlement without recognizing or rejecting the results and waiving its right to appeal the sanctions.