SG Americas Securities to Pay $3.1 Million in Total Fines to FINRA and SEC
WASHINGTON—FINRA announced today that it has fined SG Americas Securities, LLC (SGAS) $1.55 million for submitting inaccurate trade data (known as “blue sheets”) to FINRA for more than seven years. Additionally, the firm must also certify within 90 days of this settlement that it conducted a comprehensive review and revised its systems and procedures related to the deficiency. The Securities and Exchange Commission (SEC) today announced a related settlement in which SGAS will pay $1.55 million for providing inaccurate blue sheet submissions to the SEC.
FINRA and the SEC regularly request blue sheets to assist in the investigation of market manipulation and insider trading. Federal securities laws and FINRA rules require firms to provide this information to FINRA, the SEC and other regulators electronically upon request. Blue sheets provide regulators with critical detailed information about securities transactions, including the security, trade date, price, share quantity, customer name, and whether it was a buy, sale or short sale. This information is essential to regulators’ ability to discharge their enforcement and regulatory mandates.
“Incomplete and inaccurate blue sheet information in response to a regulatory request compromises our ability to identify individuals engaging in insider trading schemes, market manipulation, and other fraudulent activity, ultimately interfering with our ability to protect investors,” said Jessica Hopper, Executive Vice President and FINRA’s Head of Enforcement. “Firms must invest the resources necessary to ensure that they are providing complete and accurate blue sheet data whenever requested.”
FINRA found from 2012 through 2019, SGAS and Newedge USA, LLC (a firm that merged into SGAS in January 2015) together submitted approximately 8,400 blue sheets to FINRA containing inaccurate information on approximately 4.2 million equity and options transactions. For example, SGAS incorrectly reported: (1) whether a customer bought, sold, or sold short in a trade; (2) the strike price of options; (3) the time orders were executed; and (4) other information that regulators use to identify customer trades. SGAS is liable for its own and Newedge’s violations.
In settling this matter, SGAS neither admitted nor denied the charges, but consented to the entry of FINRA's findings.
FINRA appreciates the cooperation of the SEC in this matter.
FINRA is a not-for-profit organization dedicated to investor protection and market integrity. It regulates one critical part of the securities industry—brokerage firms doing business with the public in the United States. FINRA, overseen by the SEC, writes rules, examines for and enforces compliance with FINRA rules and federal securities laws, registers broker-dealer personnel and offers them education and training, and informs the investing public. In addition, FINRA provides surveillance and other regulatory services for equities and options markets, as well as trade reporting and other industry utilities. FINRA also administers a dispute resolution forum for investors and brokerage firms and their registered employees. For more information, visit www.finra.org.