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Top Five Most Heavily Fined Issues This Year (Annuities Among Them)

By Rita Raagas De Ramos November 6, 2018

The number of disciplinary actions reported by self-regulator Finra decreased in the first six months of 2018 compared with the same period in 2017, according to Eversheds Sutherland’s latest annual midyear analysis of Finra’s disciplinary actions.

Finra reported 342 disciplinary actions during the first six months of 2018, a 25% decline compared to the first six months of 2017’s 459 disciplinary actions, the law firm notes.

The top five enforcement issues that received the most fines in total were anti-money laundering, trade reporting, suitability, variable annuities, and books and records, the law firm says.

Eversheds Sutherland says those issues show Finra is addressing a diverse array of issues this year.

While AML and trade reporting were on the list last year, suitability and variable annuities are new trends that surfaced this year, the law firm says.

In the first half of 2017, the top five enforcement issues that received the most fines in total were AML, trade reporting, electronic communications, books and records, and research analysis and reports, according to Eversheds Sutherland.

Overall, Finra reported a slight increase in fines during the first half of 2018 compared with the first six months of 2017. Finra reported $25.9 million in fines through June 2018 compared with $23.5 million in the same period in 2017.

Finra has cautioned against finding patterns in its fines statistics. The timing and the gravity of the cases are largely responsible for the total amount of fines in any given year, according to a Finra spokeswoman.