Wedbush Securities & Its Founder Fined for Negligence
On July 19, 2018 a judgment issued by the United States Court of Appeals for the Ninth Circuit became final in which Wedbush Securities Inc. was fined $300,000 and Edward William Wedbush was fined $50,000 and suspended from association with any FINRA member in any principal capacity for 31 days. Edward Wedbush founded his firm in 1955 and served as a general partner when it was a partnership and became president of the Firm when it was incorporated. He also became Chief Compliance Officer (CCO) and the Business Conduct Manager (BCM) in August 2006. Wedbush was responsible for the firm’s compliance system and all regulatory filings. According to FINRA, from January 2005 to July 2010, the firm committed 158 violations of the rules and by-laws of the National Association of Securities Dealers Inc. (NASD), the New York Stock Exchange Inc. (NYSE) and FINRA. The findings stated that the firm reported 129 events late (RE-3, U4 and U5), 18 events inaccurate, and failed to file 11 forms (RE-3, U4 and U5). The Firm and Mr. Wedbush allegedly failed to reasonably supervise regulatory reportings, failed to implement the firm’s supervisory system, failed to detect and prevent violations and failed to implement corrective measures to address the regulatory reporting failures.
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