A broker-dealer settled FINRA charges for failing to submit certain interest rate information to the MSRB's Short-Term Obligation Rate Transparency ("SHORT") system, and for failing to establish and maintain a sufficient supervisory system.
According to the Letter of Acceptance, Waiver and Consent, the broker-dealer violated MSRB Rule G-34 ("CUSIP Numbers, New Issue, and Market Information Requirements") by failing to report to the MSRB's SHORT system the minimum denomination or maximum interest rate for variable rate demand obligations that it sold. FINRA alleged that the broker-dealer's reporting system did not require the entry of such information prior to transmitting data to the SHORT system. The missing minimum denomination information affected 27 CUSIPs, and the missing maximum interest rate information affected 30 CUSIPs. FINRA also charged the broker-dealer with violations of MSRB Rule G-27 ("Supervision") for failing to establish and maintain a sufficient supervisory system.
To settle the charges, the broker-dealer agreed to (i) a censure, and (ii) a $47,500 fine ($32,500 for the MSRB Rule G-34 violations, and $15,000 for the supervisory violations).
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