{"id":4634,"date":"2021-01-04T10:59:38","date_gmt":"2021-01-04T10:59:38","guid":{"rendered":"https:\/\/www.futuresandoptions.gr\/en\/?p=4634"},"modified":"2021-01-04T11:00:52","modified_gmt":"2021-01-04T11:00:52","slug":"finra-orders-worden-capital-management-to-pay-more-than-1-2-million-in-restitution-to-customers-whose-accounts-were-excessively-traded","status":"publish","type":"post","link":"https:\/\/www.futuresandoptions.gr\/en\/finra-orders-worden-capital-management-to-pay-more-than-1-2-million-in-restitution-to-customers-whose-accounts-were-excessively-traded\/","title":{"rendered":"FINRA Orders Worden Capital Management LLC to Pay More than $1.2 Million in Restitution to Customers Whose Accounts Were Excessively Traded"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\">Firm Also Fined $350,000 for Failing to Reasonably Supervise Recommended Securities Transactions and Other Violations<\/h2>\n\n\n\n<p>FINRA announced that it sanctioned Worden Capital Management LLC (WCM) more than $1.5 million, including approximately $1.2 million in restitution to customers whose accounts were excessively traded by the firm\u2019s representatives, and a $350,000 fine for supervisory and other violations. As part of the settlement, WCM must also retain an independent consultant to conduct a comprehensive review of the relevant portions of the firm\u2019s supervisory systems and procedures.<\/p>\n\n\n\n<p>FINRA found that from January 2015 to October 2019, WCM and the firm\u2019s owner and CEO, Jamie Worden, failed to establish and enforce a supervisory system reasonably designed to achieve compliance with FINRA\u2019s rules relating to excessive trading. As a result, WCM\u2019s registered representatives made unsuitable recommendations and excessively traded customers\u2019 accounts, causing customers to incur more than $1.2 million in commissions. In one instance, a WCM customer whose account was traded for approximately one year had a cost-to-equity ratio (or breakeven point) of more than 100 percent and incurred realized losses of $118,490, inclusive of the $205,557 the customer paid in commissions. WCM did not take action to investigate or stop the trading in this customer\u2019s account, and others like it, even though WCM received a monthly active account report that routinely flagged dozens of customer accounts indicative of excessive trading.<\/p>\n\n\n\n<p>Jessica Hopper, Executive Vice President and Head of FINRA\u2019s Department of Enforcement, said, \u201cFINRA has an unwavering commitment to protect investors from excessive and unsuitable <a href=\"https:\/\/www.futuresandoptions.gr\/en\/role-of-forensic-accounting-in-trading\/\">trading<\/a>. Firms must ensure they establish systems and procedures reasonably designed to supervise representatives\u2019 recommendations to their customers, and firms\u2019 supervisory personnel must have in place the necessary tools and training to address\u00a0<a href=\"https:\/\/www.finra.org\/media-center\/blog\/working-front-lines-investor-protection-red-flags-detect-excessive-trading\">red flags<\/a>.\u201d<\/p>\n\n\n\n<p>FINRA also found that WCM and Worden interfered with customers\u2019 requests to transfer their accounts to another member firm. In addition, as a result of supervisory failures, WCM failed to timely file amendments to registered representatives\u2019 Form U4s and Form U5s to disclose the filing or resolution of customer arbitrations.&nbsp;<\/p>\n\n\n\n<p>For Worden\u2019s supervisory violation and his interference with customer account transfers, he agreed to a 15-day suspension in all capacities, a three-month supervisory suspension, a $15,000 fine and must complete 20 hours of continuing education.<\/p>\n\n\n\n<p>In settling this matter, WCM and Worden neither admitted nor denied the charges, but consented to the entry of FINRA\u2019s findings.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>FINRA announced that it sanctioned Worden Capital Management LLC (WCM) more than $1.5 million, including approximately $1.2 million in restitution to customers<\/p>\n","protected":false},"author":2,"featured_media":4635,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[1123,14,111,22],"tags":[1314,1316,1315],"class_list":["post-4634","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finreg","category-financial-news","category-stocks-2","category-wall-street","tag-excessive-trading","tag-finra","tag-worden-capital-management"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>FINRA Orders Worden Capital Management LLC to Pay More than $1.2 Million in Restitution to Customers Whose Accounts Were Excessively Traded<\/title>\n<meta name=\"description\" content=\"FINRA announced that it sanctioned Worden Capital Management LLC (WCM) more than $1.5 million including approximately $1.2.. excessive 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