UBS Financial Services has agreed to pay a fine of $100,000 as a part of a settlement with the Financial Industry Regulatory Authority (FINRA).
From July 18, 2016, to July 23, 2021, the firm failed to include the Non-Transaction-Based Compensation (NTBC) indicator for 91,059 reports of municipal securities transactions with customers that did not include a mark-up, mark-down, or commission. All of these transactions occurred in non- managed accounts.
When designing the logic for the firm’s electronic system for reporting transactions, the firm incorrectly excluded the NTBC indicator for all transactions in non-managed accounts. The firm corrected its reporting logic in July 2021.
From July 18, 2016, to December 15, 2023, the firm’s supervisory system, including its written supervisory procedures, was not reasonably designed to ensure compliance with Real-Time Transaction Reporting System (RTRS) reporting requirements because the firm lacked any supervisory reviews or written procedures relating to the NTBC indicator.
In December 2023, the firm took steps to enhance its systems and procedures by adopting and implementing a quarterly supervisory review for the accurate reporting of the NTBC indicator.
Therefore, Respondent violated MSRB Rule G-27.
On top of the $100,000 fine, the firm has agreed to a censure.
