Investing
SEC Charges Wall Street Brokerage Firm With Anti-Money Laundering Failures
Published:
Last Updated:
The U.S. Securities and Exchange Commission (SEC) recently charged a Wall Street-based brokerage firm with failing to sufficiently evaluate or monitor customers’ trading for suspicious activity as required under the federal securities laws.
An investigation by the agency found that Albert Fried & Company (AF&Co) failed to file Suspicious Activity Reports (SARs) with regulators for over five years despite red flags tied to its customers’ high-volume liquidations of low-priced securities.
On more than one occasion, an AF&Co customer’s trading in a security on a given day exceeded 80% of the overall market volume. In other instances, customers were trading in stocks issued by companies that were delinquent in their regulatory filings or involved in questionable penny stock promotional campaigns. Certain customers also were the subject of grand jury subpoenas received by AF&Co.
Andrew Ceresney, director of the SEC’s Division of Enforcement, commented:
Albert Fried & Company ignored numerous instances when customer trading activity should have triggered the firm to file SARs. Brokerage firms must take their anti-money laundering responsibilities seriously so they can serve as a line of defense against misconduct and market risks.
While the SEC has charged other firms with anti-money laundering failures under the federal securities laws, this is the first case against a firm solely for failing to file SARs when appropriate.
AF&Co agreed to pay a $300,000 penalty to settle the charges.
Take Charge of Your Retirement In Just A Few Minutes (Sponsor)
Retirement planning doesn’t have to feel overwhelming. The key is finding expert guidance—and SmartAsset’s simple quiz makes it easier than ever for you to connect with a vetted financial advisor.
Here’s how it works:
- Answer a Few Simple Questions. Tell us a bit about your goals and preferences—it only takes a few minutes!
- Get Matched with Vetted Advisors Our smart tool matches you with up to three pre-screened, vetted advisors who serve your area and are held to a fiduciary standard to act in your best interests. Click here to begin
- Choose Your Fit Review their profiles, schedule an introductory call (or meet in person), and select the advisor who feel is right for you.
Why wait? Start building the retirement you’ve always dreamed of. Click here to get started today!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
Our expert who first called NVIDIA in 2009 is predicting 2025 will see a historic AI breakthrough.
You can follow him investing $500,000 of his own money on our top AI stocks for free.