FINRA Charges Firm for Making Misleading Statements on Website
A broker-dealer and its principal agreed to a censure, fines, sanctions and undertakings for making misleading and unsubstantiated website claims. FINRA charges that the firm failed to provide any basis for claims about sustainable returns and capital preservation. The firm also said that it was an asset management firm and included a discussion about RIAs, even though it was not a registered investment adviser. FINRA also charges that the firm misled investors about its day trading strategy and performance. In addition to fines, the firm has undertaken to file with FINRA any website before use and include FINRA comments.
OUR TAKE: FINRA is cracking down on BD offices implying that they provide asset management services, thereby misleading clients into believing they are fee-based advisers. Also, we have warned firms many times not to be too fast and loose with website claims.