Wells Fargo Clearing Services, LLC has agreed to pay a fine of $400,000 as a part of a settlement with the Financial Industry Regulatory Authority (FINRA).
From January 2017 to December 2018, the company failed to reasonably supervise a former registered representative who recommended to retail customers unsuitable, short-term trading of syndicate preferred stock, closed-end funds (CEFs), and medium-term notes (MTNs).
Wells Fargo Clearing Services failed to reasonably follow-up on identified red flags of the representative’s short-term trading of these products.
During the same period, the company failed to establish and maintain a reasonable supervisory system to assess whether its registered representatives recommended to retail customers short-term trades of syndicate preferred stocks and CEFs that…
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