Wells Fargo Feels Effect Of SEC Targeting Broker-Dealer Compliance:

The Wall Street Journal | By: Samuel Rubenfeld | November 15, 2017:

Anti-money laundering enforcement of broker-dealers by the Securities and Exchange Commission has been on the rise over the past year or so, but the $3.5 million penalty of a Wells Fargo unit stands out because it concerns a management shakeup and mixed messaging.

The SEC in January released a dedicated anti-money-laundering tool for broker dealers, laying out the various requirements specific to the industry, including the requirement to file suspicious activity reports to the U.S. Treasury Department.

It said at the time that anti-money laundering would be a priority on its broker-dealer examinations, which would include assessments with their compliance with suspicious-activity reporting requirements.

The SEC has also said it would share enforcement responsibility with the Financial Industry Regulatory Authority, the industry’s self-regulator.

“Broker-dealers must not only have a comprehensive documented program, but that program must be operating effectively in order to pass regulatory muster,” advisory firm Stout Risius Ross LLC said in a note last month.

Over the last two years, the SEC and Finra have hit brokerages with multi-million dollar fines for anti- money-laundering compliance failures, mostly for controls problems. But the suspicious activity report requirement is bubbling up too…

To read full article – please click here.

Image Credit:
Photo – Wells Fargo Branch – By Xnatedawgx (Own work) [CC BY-SA 3.0 (https://creativecommons.org/licenses/by-sa/3.0) or GFDL (http://www.gnu.org/copyleft/fdl.html)], via Wikimedia Commons