FINRA Sanctions Monex Securities Inc. $1.3 Million for Failing to Register and Supervise Foreign Personnel
Firm's President Fined and Suspended
WASHINGTON — The Financial Industry Regulatory Authority (FINRA) announced today that it has ordered Monex Securities Inc. to pay $1,100,000 in disgorgement of commissions, plus interest, obtained by unregistered foreign individuals who sold securities on the firm's behalf. FINRA also fined Monex $175,000 for failing to register the foreign representatives and for related supervisory deficiencies over a period of two and a half years. Additionally, Monex's President and Chief Compliance Officer, Jorge Martin Ramos Landero (Ramos), was suspended from acting in a principal capacity for 45 days and fined $15,000.
FINRA's rules require any associated individual engaged in the investment banking or securities business to be registered under the appropriate category of registration and the individual must pass the appropriate qualification examination.
FINRA found that Ramos executed an agreement on behalf of Monex with its parent company in Mexico that permitted numerous employees to conduct securities business on Monex's behalf by, among other things, collecting client information needed to open accounts, making investment recommendations to clients and transmitting orders. Monex paid these individuals transaction-related compensation for these efforts. None of these individuals, however, was registered in any capacity with FINRA. Ramos and Monex also failed to establish, maintain and enforce supervisory systems and written procedures to ensure compliance with applicable securities laws and regulations.
Brad Bennett, FINRA Executive Vice President and Head of Enforcement, said, "It is imperative that firms such as Monex are diligent in ensuring that all individuals who are acting as representatives of the firm are properly registered and supervised. When individuals are permitted by a firm to sell securities on its behalf without being registered and supervised, investors are at risk because of the lack of regulatory oversight."
In concluding this settlement, Monex and Ramos neither admitted nor denied the charges, but consented to the entry of FINRA's findings.
Investors can obtain more information about, and the disciplinary record of, any FINRA-registered broker or brokerage firm by using FINRA's BrokerCheck. FINRA makes BrokerCheck available at no charge. In 2013, members of the public used this service to conduct 16.5 million reviews of broker or firm records. Investors can access BrokerCheck at www.finra.org/brokercheck or by calling (800) 289-9999. Investors may find copies of this disciplinary action as well as other disciplinary documents in FINRA's Disciplinary Actions Online database.
FINRA, the Financial Industry Regulatory Authority, is the largest independent regulator for all securities firms doing business in the United States. FINRA is dedicated to investor protection and market integrity through effective and efficient regulation and complementary compliance and technology-based services. FINRA touches virtually every aspect of the securities business – from registering and educating all industry participants to examining securities firms, writing rules, enforcing those rules and the federal securities laws, and informing and educating 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 the largest dispute resolution forum for investors and firms. For more information, please visit www.finra.org.