Barclays Capital Inc. (Barclays) of New York submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Department of Enforcement of the Financial Industry Regulatory Authority (FINRA) for allegedly knowingly publishing inaccurate index returns for approximately eight months. Barclays, a large full service broker dealer and bank stationed in New York, faced similar allegations in 2011 for allegedly posting inaccurate delinquency rates.
FINRA found that Barclays, from November 2010 through February 20, 2014, published “material inaccurate coupon return information” in connection to the firm’s Pan Euro ABS Floating Rate Index (Index). FINRA found that the false publications began in November 2010 after Barclays changed its method of calculating coupon rates and adopted a new coupon return data provider. Thereafter, FINRA alleged Barclay’s information technology group of London changed the proprietary pricing and valuation system in an effort to improve analytics.
In May 2013, Barclays’ Index, Portfolio, and Risk Solutions Group (IPRS) discovered and reported these inaccuracies. In July 2013, Barclays determined it would initiate a restatement of the Index. FINRA found that Barclays continued to publish the inaccuracies to subscribers for eight months, from July through February 2014, instead of implementing corrections. In February 2014, Barclays self-reported the Index issues to FINRA.
FINRA found that Barclays failed to properly implement supervisory procedures as well as violated FINRA Rule 2010 and 2210. Without admitting or denying the FINRA findings, Barclays agreed to the sanctions, was censured, and ordered to pay a $1,000,000 fine.
Stockbrokers have been known to engage in many types of practices which violate industry and firm rules, practices, and procedures. In order to protect customers from stockbroker misconduct, FINRA rules require broker-dealers such as Barclays Capital Inc. to establish and implement a reasonable supervisory system. The implementation of the rules require supervisors to monitor employees to ensure they comply with federal and state securities laws, securities industry rules and regulations, and the firm, such as Barclays Capital, own policies and procedures. If broker dealers and/or their supervisors do not establish and implement these protective measures, they may be liable to investors for damages which flow from the misconduct. As a result, investors who have suffered losses because of their stockbroker’s unlawful or prohibited conduct can file a claim to recover damages against broker dealers like Barclays Capital, which should consistently oversee its employees in order to prevent stockbroker misconduct.
Have you suffered losses in your Barclays Capital investment account due to your stockbroker’s misconduct? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against stockbrokers for unsuitable recommendations, misrepresentations, and/or other unauthorized and prohibited conduct.
The most important of investors’ rights is the right to be informed! This Investors’ Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 40 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities, and investment law issues. The lawyers at our law firm are devoted to protecting investors’ rights throughout the United States and internationally! Please post a comment, call (800) 732-2889, send Mr. Pearce an email at firstname.lastname@example.org, and/or visit our website at www.secatty.com for answers to any of your questions about this blog post and/or any related matter.