WASHINGTON — A New York-based dealer firm has agreed to pay $25,000 to settle Financial Industry Regulatory Authority charges that it did not accurately report trades or maintain an adequate supervisory system.
Revere Securities agreed Thursday to pay the fine and be censured while neither admitting nor denying FINRA’s findings that the firm violated two Municipal Securities Rulemaking Board rules in 2016 and 2017.
According to FINRA, between July 7, 2016, and June 28, 2017, Revere did not report the time of execution for its municipal securities transactions to the Real Time Transaction Reporting System (RTRS) accurately as required by MSRB Rule G-14 on reports of sales or purchases. The rule states that dealers must report information “promptly, accurately, and completely."
But because the firm did not enter the times of execution into its clearing firm's reporting system, FINRA said, the system defaulted to recording the time of entry into the system as the transaction time.
“For example, during the second quarter of 2017, all 67 of the firm's municipal securities transactions were reported to RTRS with an incorrect time of execution,” FINRA found.
FINRA said Revere also violated MSRB Rule G-27 on supervision, which requires firms to have and enforce written supervisory procedures (WSPs) “reasonably designed” to ensure compliance with securities laws and MSRB rules.
Revere’s WSPs at the time required that the time of execution be manually entered into its clearing firm's reporting system, FINRA determined, but “wholly failed” to address how and when supervisory reviews would be conducted to ensure that the reporting was accurate.
Filed with the settlement was a corrective action statement signed by Revere’s Chief Compliance Officer, Charles Slavinsky. The firm now instructs its personnel to override the clearing firm system’s default and manually enter the execution time, Slavinsky told FINRA, and hired a new employee tasked with improving the firm’s internal auditing. Slavinsky himself has also taken steps to build a better rapport with the clearing firm’s bond desk, he told FINRA.
“Revere Securities LLC is committed to enhancing our Compliance and supervisory efforts in order to comply with all required regulations,” Revere’s statement concludes.
Slavinsky did not respond to a request for further comment.
