Two companies fined by regulator

Two companies fined by regulator

Two companies fined by regulator Two firms have fallen foul of the Financial Industry Regulatory Authority (Finra) in the USA.
According to a report by Bond Buyer, both Edward Jones and Stoever, Glass & Company have been fined by the regulator in separate charges.

In the case of Edward Jones, it has settled for $200,000 on accusations that it was misrepresenting to its clients that the interest it paid them on short positions for municipal bonds was non-taxable.

The publication writes that the company has procedures and policies in place for short positions – but from June 2009-December 2014 the company held around 244 short positions, sometimes for more than a year. Allegedly when it paid interest to customers as a substitute payment on long positions, it told clients that a minimum of $129,624 would be exempt.

As well as paying the fine, Edward Jones has also agreed to settle the clients’ tax obligations.
Meanwhile, Stoever, Glass & Company picked up a fine of $40,000 for selling municipal bonds below the minimum level of proscribed denominations.

Its fine related to 14 transactions and two bonds with amounts smaller than the $100,000 minimum denomination.