Written by The White Law Group• October 29, 2020• 7:58 pm• Blog, Current Investigations

National Securities Corp. Sanctioned for Violations

National Securities Corp. Sanctioned for Sales Practice Violations and Supervisory Issues, featured by top securities fraud attorneys, The White Law Group

National Securities Corporation (CRD No. 7569, Boca Raton, Florida) Censured and Fined $125,000

According to the Financial Industry Regulatory Authority (FINRA) on October 27, the regulator reportedly censured and fined broker-dealer National Securities Corp. $125,000 in connection with sales practices violations and supervisory issues.

FINRA allegedly found that between May 2015 and November 2018, National Securities corp. reportedly filed four late Form U4 amendments, filed eight late Form U5 amendments, and failed to file five Form U4 amendments.

During this period, the firm also purportedly failed to report or reported late statistical and summary information for 19 written customer complaints, reported late a $30,000 settlement of a customer’s claim against one of its associated persons for sales practice violations, and submitted 34 inaccurate or incomplete filings required by FINRA.

Further, National Securities Corp. also allegedly failed to enforce its written supervisory procedures designed to achieve compliance with reporting requirements for Form U4 and U5 amendments and FINRA Rule 4530 filings.

In addition, from July 2015 through March 2017, the firm reportedly failed to establish, maintain, and enforce written supervisory procedures reasonably designed to achieve compliance regarding contingency offerings. During this period, National Securities participated as a placement agent in more than 20 contingency offerings.

Hiring a Securities Attorney

Brokers and financial advisors may commit investment or securities fraud in an effort to control the market, gain business, or maximize commissions.

All broker-dealers have a responsibility to adequately supervise its employees. They must ensure the necessary procedures and systems to detect misconduct. Brokerage firms that fail to monitor the business activities of their employees may be liable for investment losses due to negligent supervision for the misconduct of their employees.

When brokers violate securities laws, such as making unsuitable investments, the brokerage firm they are working with may be liable for investment losses through FINRA Arbitration.