According to reports, FINRA has fined Cetera Investment Services, a subsidiary of Cetera Financial Group Inc., $75,000 for allegedly failing to notify clients of account record changes.
Reportedly from October 2008 through November 2013, a total of 57,881 notifications about changes to client account records, including name, address and investment objective of accounts, were not sent out to customers according to a document from Financial Industry Regulatory Service Inc.
FINRA alleges that in 2008 certain former Cetera customers stated that they continued to receive notices about account changes even after leaving the firm. To correct this error, Cetera reportedly used a computer code that stopped notices from being sent to the former customers, but to current customers as well.
A firm is required under the current securities law to create and maintain an account record for each customer and notify them in case of any changes.
FINRA states the error caused by the faulty computer coding was not detected by Cetera since they lacked the procedures to supervise proper generation and mailing of such notices.
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Tags: Cetera client account records, Cetera computer coding, Cetera FINRA fine, Cetera FINRA investigation, Cetera FINRA sanction Last modified: July 29, 2016
