Miami Broker-Dealer Violates Anti-Money Laundering Protocols and Pays SEC a $1 Million Penalty

The SEC settled charges with a Miami-based brokerage firm last week, claiming that it violated anti-money laundering ("AML") rules by allowing foreign entities to buy and sell securities without verifying the identities of the non-U.S. citizens who beneficially owned them. All financial institutions are required to maintain a customer identification program ("CIP") wherein such financial institutions must establish, document and maintain procedures for identifying all customers and to verify their identities. Here, the firm agreed to pay a $1 million penalty as a result of the SEC's allegations. As part of the SEC's settlement, the firm also had to retain an independent monitor to directly review its AML/CIP policies, procedures and practices for the next two (2) years. The SEC acknowledged that no fraud occurred in this instance. But, nevertheless, found there were significant gaps in the framework of the firm's AML/CIP policies that left the firm susceptible to potential illegal activity by customers who were not fully known to the firm. To read the full press release, please click on the link below:

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Cheryl Spratt