Laidlaw & Company LTD., headquartered in London, England, was censured and fined $10,000.00 by Financial Industry Regulatory Authority (FINRA) after consenting to findings that the firm had charged customers with excessive commissions on equity transactions. Letter of Acceptance, Waiver and Consent, No. 2014040622201 (July 21, 2016).
According to the AWC, from April 2013 through June 2014, the firm had charged customers with a commission on equity transactions in addition to handling fees associated with some equity transactions. Particularly, the AWC stated that the firm charged $27,787.07 in commissions in four hundred and twenty-one transactions.
In the AWC, FINRA noted their adopted guidelines which referred to five percent commissions on agency based trades and five percent principal based mark-ups or mark-downs to be unfair and unreasonable. FINRA also referred to the factors in NASD IM-2440-1(b), and Supplementary Material 0.1(b), which assessed fairness by reviewing the security’s availability, the specific type of security, the price, the size of securities transaction, etc. After a review of firm’s transactions, FINRA claimed that the firm’s charges to customers were not reasonable and fair.
Ultimately, FINRA claimed that the Ladlaw & Company LTD’s conduct constituted the excessive charging of customers; conduct violative of FINRA Rules 2010, 22121, as well as NASD Conduct Rule 2440 and NASD IM-2440-01.
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