RBC Capital Markets, LLC has agreed to pay a fine of $75,000 as a part of a settlement with the Financial Industry Regulatory Authority (FINRA).
From January 2016 to at least December 2023, RBC’s system that provided customers with rights of reinstatement benefits on eligible transactions was not reasonably designed in several respects. The firm’s oversight of discounts available through rights of reinstatement relied on automated alert that was set to identify transactions in which a customer liquidates a position in a fund family and then purchases back into the same family at a later date.
Through at least December 2021, the alert parameters were set so that the alert would only trigger when the principal of the transaction was more than $1,000. The parameters were also set so the alert would trigger only when a right of reinstatement window was for 100 days or…
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